Employee Directed Gift to A Charity
Employee Directed Gift to a Charity by Arthur Drache Making a charitable donation in honour of or in memory of a third party is of course a common event. In such a case, the donor will normally get a receipt for tax purposes and the charity will arrange for the ...
A Fiduciary Obligation
A Fiduciary Obligation Does Not (Necessarily) a Fiduciary Make By Joel Secter Regular readers may recall the article we wrote (click here) on the topic of officer liability. There we commented on circumstances in which officers of corporations under the Canada Not-for-profit Corporations Act (CNCA) (whether continued to it or ...
The Impact of Business Activities
The Impact of Business Activities on Your Organization by Brent Randall If you operate an organization that engages in business activities (which CRA defines as deriving revenues from the provision of goods and/or services), the nature and goals of this business can help determine whether charitable registration is suitable for ...
Ideas for Advanced Fundraising
IDEAS FOR ADVANCED FUNDRAISING by Adam Aptowitzer Given the competition for donor dollars it is surprising that gifts of non-qualified securities do not attract more attention. These types of securities are usually shares or debt of private corporations. As private corporations and their shareholders form a significant segment of the ...
Non Profit Organizations and the Income Minefield
Non-Profit Organizations and the Income Accumulation Minefield By Alexandra Tzannidakis Under section 149(1)(l) of the Income Tax Act, entities that meet the definition of a "non-profit organization" (NPO) are exempt from paying federal income tax. The section defines an NPO as a club, society or association that is not a ...
If They Were So Prescient, How Did They Not See That Coming?
If They Were So Prescient, How Come They Did Not See That Coming? By Adam Aptowitzer On May 1st, 2013 the Federal Court of Appeal issued its judgment in the Prescient Foundation[1]. The case itself was notable not simply because of the decisions rendered by the Court on the questions ...
Getting on Board with the CNCA
Getting on Board with the CNCA By Alexandra Tzannidakis You may have heard this already, but apparently it bears repeating: All charities and non-profit organizations incorporated under Part II of the Canada Corporations Act need to actively 'continue' to the new Canada Not-for-profit Corporations Act if they wish to stay ...
Membership is About Control
Membership is About Control By Joel Secter Though we advise charities and non-profits at all stages in their evolution, we typically get involved in the start-up phase. At the start up phase we often recommend incorporation, most notably because of the limited liability protection it provides. Our discussions with clients ...
Good for the Goose, Not Apparently for the Gander
Good For The Goose, But Not Apparently For The Gander By C. Yvonne Chenier, Q.C For the last few years all registered Canadian charities have had to list compensation information on Schedule 3 of their T3010 registered charity information return. Not only is the total compensation amount for all employees ...
Personal Political Activity
Personal Political Activity By Arthur Drache, C.M. Q.C. About eighteen months ago David Suzuki, the high profile environmentalist, did a video endorsing the Ontario Liberal government's environment policies during a the provincial election. Questions were raised as to whether this somehow would be translated into "political activity" by the Suzuki ...
CRA Helps Canadian Find the Right Charity
CRA HELPS CANADIAN FIND THE "RIGHT" CHARITY C. Yvonne Chenier, Q.C. In 2012 the Canada Revenue Agency, Charities Directorate created "quick view", a graphic display of the information presented by a charity on their annual T3010 form. Now, in 2013 the CRA is tweeting about and otherwise promoting the existence ...
Residential Condos as Non-Profits
Residential Condos as Non-Profits By Arthur Drache, C.M. Q.C. In the past year or so there have been some concerns expressed as a result of some CRA Technical Interpretations[1] about whether certain corporations qualify as non-profit corporations under paragraph 149 (1)(l) of the Income Tax Act.the potential implication being that ...
Dealing With Fraudulent Donations
Dealing with Fraudulent Donations By Alexandra Tzannidakis There is a great deal of information available for individuals on how to avoid donating to a fraudulent or otherwise problematic charity. But the donor-donee relationship goes two ways: what happens when a charity receives a donation that turns out to be fraudulent ...
Working Around Ban on Ex Officio Directors
Working Around Ban on Ex Officio Directors By Joel Secter A complication that arises under the new Canada Not-for-Profit Corporations Act (the "Act") is that it does not permit ex officio directors.[1] A director is ex officio when appointed to a board by virtue of holding another office or position ...
CRTs are Alive and Well
CRTs are alive and well in Canada. at least at the CRA Rulings Directorate C. Yvonne Chenier, Q.C. Over the past decade there have been many positive changes relating to the tax treatment of charitable donations such as the full capital gain exemption with regard to publicly traded securities. These ...
Each Their Own: Look Out for Different Provincial Regimes
To Each Their Own: Look Out for Different Provincial Regimes By Adam Aptowitzer Those running a charity could be forgiven for thinking that there are no provincial rules which apply specifically to charities. In fact, this is not the case and we have written several times about such laws as ...
Visual Artists Granted Leave to Appeal
Visual Artists Granted Leave to Supreme Court By Joel Secter Getting to the Supreme Court of Canada is no easy feat, so we took notice of the Court's recent announcement that they have granted Canada's professional visual artists leave to appeal.[1] The case stems from a complaint filed pursuant the ...
Adhering to Gift Terms
Adhering to Gift Terms By Arthur Drache, C.M. Q.C. Virtually every major gift to a charity carries with it some level of terms, most commonly with regard to the use. The more valuable the gift the more likely that the gift agreement will spell out in great detail the terms ...
How Not to Choose a Charity
How Not to Choose a Charity: The Folly of Overhead Ratios By Alexandra Tzannidakis To the ongoing despair of the non-profit sector, the number one criterion that potential donors use in selecting a charity continues to be the ominous "overhead ratio". In the face of all the information available to ...
Stay of Execution: New Precedent for Charities Facing Immediate Revocation
STAY OF EXECUTION: A PRECEDENTIAL WIN FOR A CHARITY AT THE FEDERAL COURT OF APPEAL by Adam Aptowitzer The charities community is well aware that the Canada Revenue Agency works to shut down charities it feels are deserving of such a punishment. In some circumstances, notably, but not exclusively, with ...
Death and Taxes May be Inevitable, But Does it Have To Be So Complicated?
Death and Taxes May Be Inevitable, But Does It Have To Be So Complicated? by Adam Aptowitzer We have written before (several times in fact) of the great untapped potential in the donation of shares of private companies to charity. That there is great value in private companies is evident ...
Tick-Tock: Its Time to Continue
Tick Tock: It's Time to Continue By Joel Secter October marks one year to the deadline for corporations incorporated under Part II of the Canada Corporations Act (CCA) to transition to the Canada Not-for-Profit Corporations Act (CNCA). This should come as no surprise; the CNCA came into force in 2011 ...
Fitting a Square Peg in a Round Hole
Fitting a Square Peg into a Round Hole by C. Yvonne Chenier, Q.C. Anyone who has submitted a T2050 application for charitable status and has been rejected by the Canada Revenue Agency Charities Directorate knows the process can be quite frustrating. We spend hours with our clients to fine tune ...
Donations to a Non-Profit
Donations to a Non-Profit By Arthur Drache, C.M. Q.C. A recently published letter by the CRA[1] deals with the treatment of "donations" to a non-profit organization.clearly distinct from a donation to a registered charity. The discussion may be of particular interest to non-profits which are of considerable size and which ...
Books and Records For Charities: Part 1 (An Introduction)
Books and Records for Charities: Part I (An Introduction) By Alexandra Tzannidakis The failure to maintain books and records is ground for suspension of a charity's tax-receipting privileges. Such a suspension can translate into the loss of big donations. This article is the first in a series on what "books ...