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December 19, 2014

CBC article “Holiday giving? Don’t pick a charity by financial statements alone”

CBC discusses charitable giving in an article entitled "Holiday giving? Don't pick a charity by financial statements alone: Research, volunteer and donate directly if you want to give smart this holiday season".

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December 15, 2014

Industry Canada has sent out 16,000 notices of pending dissolution to 6000 Federal non-profits

Over the last 6 weeks Corporations Canada of Industry Canada has sent out an estimated 16,000 notices to approximately 6000 Canadian Federal non-profit corporations that are still under the Canada Corporations Act (CCA)  Industry Canada sends notices to the corporation and to each director.  They also publish the names of the corporations online.

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December 14, 2014

Broader Public Sector Executive Compensation Act, 2014 in Ontario has passed.

We have discussed on this blog the Broader Public Sector Executive Compensation Act, 2014 (the "Act"). The Act has now been passed on December 9, 2014 and received Royal Assent on December 11, 2014.   It will be interesting to see the effect of this Act on non-profits and charities in Ontario.

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December 13, 2014

Blumbergs’ Canadian Charity Law Boot Camp 2015

We are looking forward to presenting the Blumbergs' Canadian Charity Law Boot Camp 2015 on April 14, 2015.   For information or to register see: Blumbergs' Canadian Charity Law Boot Camp 2015

December 13, 2014

CRA revokes registration of Ecotecture: Centre for Ecological Art and Architecture

The Charities Directorate of the Canada Revenue Agency has revoked the charitable registration of Ecotecture: Centre for Ecological Art and Architecture for its involvement in a scheme known as the Via Project or Vintage Iconic Archives.   The former registered charity had issued over $200 million in receipts.  

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December 05, 2014

Notice of Pending Dissolution from Industry Canada

Here is a Notice of Pending Dissolution from Industry Canada that we recently reviewed.  Industry Canada will be sending out thousands of these over the next few months.   

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December 04, 2014

Changes to the Directors’ Information listed on Corporations Canada’s website

For a number of months Corporations Canada of Industry Canada has provided more director information on their website with respect to Federal non-profit Corporations under the Canada Corporations Act (“CCA”) and new Canada Not-for-profit Corporations Act (“CNCA”). Previously, the list of directors (and their addresses) was excluded from the free corporate information provided on Corporations Canada’s website.  However, the public was able to access this director information by filing a request with Corporations Canada (a fee per page was being charged and you had to provide a credit card for the $1-$2 charge which is cumbersome).

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December 03, 2014

Tidal wave of false receipting cases from Tax Court of Canada

Tax Court of Canada has released a number of judgements dealing with false receipting this week.  The cases all relate to a scheme in Vancouver involving the issuance of approximately $12 million in false receipts.  The cases of Azim Bani (2012-35421(IT)I, Jose Vekkal (2013-882(IT)I), Remmy Vekkal (2013-883(IT)I), Martin Izkendar (2013-220(IT)I), Ruben Nocon (2013-635(IT)I), Iraj Rasuli (2013-886(IT)I), Khorshid Rasuli (2013-887(IT)I), Ladan Abootaleby-Pour (2013‑1779(IT)I) and Oleg Komarynsky (2013-3354(IT)I) all related to this scheme.  In one case for example it notes that CRA "alleges that the Appellant purchased false charitable donation receipts from his accountants, Fareed Raza and Saheem Raza (the “Raza Brothers”). The Raza Brothers provided accounting and tax services under the trade names Fareed Raza & Co. Inc. and F & A Accounting Corporation (“FA”). The Raza Brothers were charged with fraud for making false statements on income tax returns prepared by them for their clients."  The Tax Court of Canada disallowed these false receipts.  

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November 28, 2014

Problem of abusive charity gifting tax schemes is even greater than thought

I just read this CRA FAQ with the latest numbers on abusive gifting charity tax shelters.  "As of March 31, 2014, the CRA has denied more than $6.3 billion in donation claims and reassessed over 190,000 taxpayers who participated in these gifting tax shelters. The CRA has also assessed more than $162 million in third party penalties against promoters and tax preparers."

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November 27, 2014

Which Canadian registered charities spent the most on political activities in 2013?

CRA has posted the T3010 Registered Charity Information Returns for 82,000 of the 86,000 Canadian registered charities.   About 477 Canadian registered charities identified conducting political activities whether by volunteer, staff or spending funds. Here is a link to our article "Which charities spent the most on political activities in 2013?"

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November 26, 2014

CBC story on “Canada Revenue Agency privacy breach leaks prominent Canadians’ tax details”

The CBC has disclosed that CRA had provided them with a list of private information on taxpayers who had applied for certain tax benefits as a result of donating cultural property through the Cultural Property Export Review Board.   Disclosure of confidential taxpayer information is a serious issue and CRA has released a statement apologizing for the laps and confirming that the CRA will contact each of the taxpayers who were affected. This disclosure appears to be accidental and a mistake on CRA's part.  

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November 26, 2014

CRA puts out another warning about abusive charity gifting tax shelters

CRA has put up another reminder to Canadians about abusive charity gifting tax shelters.  The tiltle is "Warning: be cautious if you are thinking of participating in a gifting tax shelter schemes"

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November 24, 2014

CRA adds another US charity to list of qualified donees that received gift from Canada

As we have noted before the "List of registered foreign charitable organizations that have received a gift from Her Majesty in right of Canada" had lost all of its charities.  Then the "Bill, Hillary & Chelsea Clinton Foundation" was added and now the Woodrow Wilson International Center for Scholars has been added.  Both were previously on the list.  

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November 22, 2014

Humanics Institute v. MNR - refusal to register charity that claims to advance religion

The Federal Court of Appeal recently heard a case dealing with an organization that had applied for charitable status and been denied by the Charities Directorate of CRA.   There were a number of grounds for refusal including that "the plan to build and maintain a sanctuary and sculpture park, would not advance religion or education in the charitable sense." The FCA did not accept the appellant organization's arguments that the decision was "unreasonable, procedurally unfair, and in violation of sections 2(a), 2(b), and 15 of the Canadian Charter of Rights and Freedoms".  

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November 18, 2014

DFATD Call for proposals for $370 million in funding for Maternal, Newborn and Child Health

Groups interested in international development and humanitarian assistance may want to review the new call for proposals from the Foreign Affairs, Trade and Development Canada (DFATD).  

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Topics: News | Global Giving | CIDA

November 13, 2014

Industry Canada has started sending out notices of dissolution to Federal Non-profits

Industry Canada has started the long and arduous process of notifying corporations under the Canada Corporations Act that have NOT continued to the CNCA that they will be dissolved.  Industry Canada has sent notices of pending dissolution to the CCA corporations.  Industry Canada's Monthly Transactions for November include a list of which corporations have received such notices of pending dissolution.

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November 12, 2014

Ford v. Canada -what is “with all due dispatch” when dealing with a CRA reassessment

Ian Ford and Norma Ford appealed a Tax Court of Canada 2014 decision relating to taxation years going back to around 1999 -2001.    The decision notes that "Ian Ford and Norma Ford participated in an art donation program operated by Canadian Art Advisory Services. They purchased pieces of art for a particular price and then donated the art to a charity. For each donation they received a receipt for an amount that exceeded the amount that they paid for the art." Needless to say CRA did not accept the valuation and donation receipts.   CRA assessed the Fords in 2002 and then reassessed them in 2012.  The Fords argued that it was unfair that the reassessment happened so many years after the transaction.  The FCA did not agree.  The interesting part was that the legal arguments the Fords were making would have actually increased their taxes!    

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November 11, 2014

Bill 8, Public Sector and MPP Accountability and Transparency Act, 2014 - Ontario to cap salaries

Here is a copy of Ontario Bill 8, Public Sector and MPP Accountability and Transparency Act, 2014. Of particular concern is the Broader Public Sector Executive Compensation Act, 2014 (the "Act").  According to the act, "The purpose of this Act is to manage executive compensation in the broader public sector by authorizing the establishment of compensation frameworks applicable to designated employers and designated executives."  The act applies to hospitals, boards of education, universities, colleges, other post-secondary institutions, community care access corporations to name a few and also any other board, council, corporation, foundation or organization that is prescribed Ontario government. It does not apply to for-profit corporations. The Act only applies to "designated executives" who make cash compensation of $100,000 or more.  It does not apply to unionized employees.  The Ontario government may provide directives requiring disclosure of salaries, bonuses, incentive plans, allowances, agreements, compensation policies and compensation studies to name but some of the items.  

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November 09, 2014

Ontario Corporations Don’t Need to Wait for the ONCA - Continuing from the OCA to the Federal CNCA

Here is a recent article from Mark Blumberg and Kate Robertson entitled Ontario Corporations Don't Need to Wait for the ONCA - Continuing from the OCA to Federal Jurisdiction.  For many Ontario corporations who don't want to wait for the ONCA which may or may not come into force in 2016, or want to carry out governance changes now, a continuance from Ontario to Federal may be an appealing option.

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November 08, 2014

Carleton’s Master of Philanthropy and Nonprofit Leadership (MPNL) -apply for 2015

Carleton has a very interesting program that seeks to increase understanding of the non-profit and charitable sector. The Masters in Philanthropy and Nonprofit Leadership (MPNL) is accepting applications for Summer 2015.  The deadline to apply is January 15, 2015.  I have been fortunate to be on an advisory committee for the MPNL and it is wonderful to see the program taking off.   

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Topics: News

November 06, 2014

CRA provides information on Sponsorships and GST/HST

CRA recently released some information with respect to GST/HST and sponsorships in issue No. 93 of Excise and GST/HST News. 

We have included the CRA excerpt on sponsorships below:

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November 06, 2014

CRA letter on qualifying as a public body performing a function of government

CRA recently released a letter which discusses whether a council that represents different Bands in a unified manner on certain Aboriginal title and rights matters qualifies as a 'public body performing a function of government'. CRA determined that the Council would be considered a public body performing a function of government in Canada within the meaning of paragraph 149 (1) (c) of the Act and therefore no tax would be payable by the Council on receipt of funds from a trust.

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November 06, 2014

CRA letter on tax exemption of income allocated to a First Nation from a limited partnership

CRA recently released a letter which discussed whether income allocated to a First Nation from a limited partnership is exempt from tax because the First Nation is a public body performing a function of government. 

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October 31, 2014

Industry Canada updates their FAQ’s on CNCA continuances

Industry Canada has updated their "Frequently Asked Questions" with respect to the CNCA Continuance process to provide some useful information to the public on what will happen to corporations still under the CCA now that the continuance deadline of October 17th has passed. 

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October 29, 2014

Industry Canada provides notice of delays in processing corporate documents

If you are submitting corporate documents to Industry Canada then expect delays in processing.   What might have been a 1 week turnaround for a continuance may now be 2 weeks.   This delay is caused by a large number of last minute continuance filings.   However, if you have not filed your continuance documents do not despair - see our note here.

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Do you require legal advice with respect to Canadian or Ontario non-profits or charities?

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Charity Lawyer Mark Blumberg

Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.

mark@blumbergs.ca
416.361.1982
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