Originally Posted by Shareholder
In order to claim a tax deduction from such a charitable donation, would you not have had to have your miles valuated and thus taxed initially? As KH notes, you are verging on a slippery slope, as would be the charity issuing the tax certificate. I am not sure you can have it both ways: earn miles and not have them taxed, but donate miles and get a charitable tax deduction.
Just to clarify maybe the obvious, but you can only be taxed on frequent flyer miles you earn through employment (i.e. business trip earn miles, but use those miles to redeem for a personal trip).
see exerpt from IT-470R -->
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Frequent Flyer Program
¶ 14. Under this program, which is usually sponsored by an airline, a frequent air traveller can accumulate credits which may be exchanged for additional air travel or other benefits. Where an employee accumulates such credits while travelling on employer-paid business trips and uses them to obtain air travel or other benefits for the personal use of the employee or the employee's family, the fair market value of such air travel or other benefits must be included in the employee's income. Where an employer does not control the credits accumulated in a frequent flyer program by an employee while travelling on employer-paid business trips, the comments in ¶ 3 above will not apply and
it will be the responsibility of the employee to determine and include in income the fair market value of any benefits received or enjoyed.
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However, if you earn miles for trips you pay for yourself for personal use, these cannot be subject to tax. You used after-tax money to pay for the trip, and there is no "source" to which CRA can tax you.
Regarding the valuation issue, I assume it would be up to the recipient charity to determine the fair market value of the miles received.