Blog

April 01, 2010

UK Guidance “Charities working internationally” is helpful for Canadian charities

Although the law in the UK is not identical to Canada there are a number of interesting parts to this UK Charity Commission Guidance entitled “Charities working internationally”.  The Guidance can be found at the following location:

read more

April 01, 2010

CRA publication “What’s the Scoop 2010” - Information for Canadian Registered Charities

The Charities Directorate of the Canada Revenue Agency has recently mailed out a one-time direct mail piece to Canadian registered charities.  For an electronic copy see the English edition of RC296E What’s the Scoop 2010 or the French version RC296F En exclusivité 2010 Renseignements pour les organismes de bienfaisance enregistrés

April 01, 2010

CRA’s Charities Partnership and Outreach Program

The Charities Partnership and Outreach Program (CPOP) is an important CRA initiative to enhance Canadian charity’s understanding of their compliance obligations.  Over the last few years there have been about 20 programs run by Canadian registered charities and funded in part by the CRA.  One of the projects that I worked on, the Charity Law Information Program of the Ontario Community Support Association, has received funding from the CRA.

read more

April 01, 2010

Budget 2010, Disbursement Quota Changes and Anti-Avoidance Provisions

There are some that are wondering how the budget, revisions to the disbursement quota, some changes to the T3010 and new anti-avoidance will affect their charity.  Cathy Hawara, the Acting Director General of the Charities Directorate recently provided some information, requested feedback and will be putting out a “Questions and Answers” on the subject shortly.

read more

March 31, 2010

Coleman v. The Queen - CRA wins case that no donation when children/grandchildren benefit from gift

I think that some people assume that if a tax avoidance scheme is sufficiently complicated or “grey” and sufficiently well documented that the courts will allow those schemes.  If you make that assumption you might want to read Coleman v. The Queen, 2010 TCC 109 (January 25, 2010) as this case may change your mind.  Coleman discusses in detail whether a “donation” to a charity that provides a scholarship or bursary through a scheme to their child or grandchild should be receiptable.  The decision is 45 pages long which will be presumably ‘welcomed’ by those who complain that some of the recent Federal Court of Appeal decisions are too short!  Blake Bromley of Benefic Law Corporation argues for the unsuccessful appellants.  Mr. Justice Campbell J. Miller of the Tax Court of Canada decides for the CRA in this very well written case in which he decides that there is no donation when the children or grandchildren of a donor benefit from the gift.  In addition to the pure legal issues in this case there are also some interesting ethical issues raised by the conduct of the registered charity (National Foundation for Christian Leadership) and the donors.

read more

March 31, 2010

Objects and Activities of Canadian charities - CRA discusses importance when registering charity

The CRA discusses questions including 1.What is meant by broad and vague objects? 2.What is the problem with broad and vague objects? 3.Is there a way to keep our objects broad and still be eligible for registration as a charity? 4.What is the difference between purposes (or objects) and activities? 5.Why are purposes and activities important?  6.What is “sufficient” information?

read more

March 30, 2010

Charities Directorate Website will have new look to home page separating charities + donor section

CRA will be updating the Charities and Giving home page.  Here is a note on the What’s New section of the CRA website. [The Changes have now taken place - see http://www.cra-arc.gc.ca/chrts-gvng/chrts/menu-eng.html as of April 9, 2010]

read more

March 25, 2010

Letter from Albina Guarnieri re: private members bill (C-470) on registered charity compensation

Here is a copy of a letter I am told was sent from The Hon. Albina Guarnieri, M.P..  The letter is in italics.  I have placed in bold italics the parts that I find most objectionable and at the end of each paragraph in brackets and bold my comments.  I have previously written on this issue at www.canadiancharitylaw.ca

read more

March 22, 2010

Lockie v. The Queen - courts side with CRA again on charity gifting tax shelters -FMW=what you paid

In Lockie v. The Queen, 2010 TCC 142 (March 18, 2010) the Tax Court of Canada ruled that with a donation scheme involving pens and toothbrushes that were donated to a charity as part of a charity gifting tax shelter scheme that the fair market value of the items is not the retail fair market value of the items as suggested by the taxpayer but is the amount paid by the taxpayer for the items.  That is how a $20,043 tax receipt should only have been $3,800.  Every year there are a number of new gifting tax shelter schemes that argue they are different than earlier schemes.  It is interesting to see how carefully the judges went into detail to discredit the valuation provided in support of the taxpayer position and there is no reason to believe that with any tax shelter gifting arrangement that I have seen the result would be any different.

read more

March 22, 2010

Social enterprise and Canadian charities - are recent changes to DQ + Charitable Gifts Act enough

Will Recent Legal Changes that make social enterprise for registered charities easier in Canada be enough?

read more

March 17, 2010

CRA discloses substantial penalty against promoter of tax shelter gifting arrangement

In this recent press release from CRA they noted that “Promoters and other third?party representatives are penalized when they make false statements involving schemes that are against the law. Currently, there are 71 audits involving promoters. Recent examples include a scheme involving RRSPs, for which the promoter was assessed a penalty of $1.8 million, and a tax shelter gifting arrangement case where the Canada Revenue Agency (CRA) proposed two penalties of $24 million against the promoters involved.”

read more

March 17, 2010

CRA publishes GI-067 Basic GST/HST Guidelines for Charities as well as for public institutions

The CRA has just released a brochure entitled GI-067 Basic GST/HST Guidelines for Charities http://www.cra-arc.gc.ca/E/pub/gi/gi-067/README.html This will be helpful especially to charities in BC and Ontario that are moving to HST on July 1, 2010.  They have also put out GI-066 How a Charity Calculates the Net Tax to be Reported on its GST/HST Return at http://www.cra-arc.gc.ca/E/pub/gi/gi-066/README.html CRA has also put out a brochure for “Public Institutions” which includes registered charities that are a “school authority, a public college, a university, a hospital authority, or a local authority determined by the CRA to be a municipality” and it is located at http://www.cra-arc.gc.ca/E/pub/gi/gi-068/README.html.

March 16, 2010

Private members bill on Canadian registered charity salary disclosure and salary cap not helpful

The Globe and Mail reported on March 16, 2010 that a Liberal MP is proposing a private members bill that would make salary disclosure mandatory for the top 5 executives of a registered charity and cap all payments to any employee at a Canadian registered charity to $250,000 per year.  It is nice to see a politician that is interested in the inner workings of the charitable sector but I don’t think this particular proposal is helpful.  [MB. I have added further information as it has become available.]

read more

March 16, 2010

Recent CLIP communique on disbursement quota (DQ) reform, fraud and cases

Here are some recent items from the Charity Law Information Program (CLIP) Communique.

read more

March 15, 2010

Preventing Corruption in Humanitarian Operations: A Handbook of Good Practices

It was a pleasure having Marie-Luise Ahlendorf of Transparency International Global Programmes presenting this report and handbook at the recent Charity Law Information Program conference in Toronto.  The handbook is easy to read and “compiles best practice from the field, including ways to track resources, confront extortion and detect aid diversion.”  Preventing the diversion of humanitarian assistance should only be a concern of those who care whether beneficiaries actually receive the aid!  http://www.transparency.org/content/download/49759/795776/Humanitarian_Handbook_cd_version.pdf

read more

March 15, 2010

2010 Federal Budget enhances anti-avoidance rules for Canadian charities

The 2010 Canadian Federal budget had some changes to the Income Tax Act to prevent transactions by registered Canadian charities that “may reasonably be considered that a purpose of the transaction was to avoid or delay unduly the expenditure of amounts on charitable activities”.

read more

March 15, 2010

CanadaHelps free webinar on fraud prevention and their Charity Fraud Awareness Quiz

These resources may be of interest to those who wish to combat fraud in the charitable sector or targetting charities.

read more

March 11, 2010

10 Most Useful Features of the CRA’s Charities Directorate Website for Canadian Charities

Here is a copy of an article I wrote for the newsletter “Charitable Thoughts” of the Ontario Bar Association Charity and Not-for-Profit Law Section

read more

March 10, 2010

Changes to Accounting Standards for Not-for-Profit Organizations

Over the next few years there may be changes to the accounting standards for non-profit organizations in Canada.  This piece entitled Changes to Accounting Standards for Not-for-Profit Organizations from the Canadian Institute of Chartered Accountants (CICA) reminds those who are interested that certain exposure drafts were released March 3, 2010 by the Accounting Standards Board and the Public Sector Accounting Board. The public can comment on those drafts until July 15, 2010.

March 08, 2010

Canada Blacklists Somali group, al-Shabab, because of involvement with terrorism

The Canadian government recently blacklisted a Somali group called al-Shabab for involvement with terrorism.  Canadian charities and individuals must take care not to support directly or indirectly any groups that are on Canada’s terrorism watch list.  Here is an article that I recently wrote on “Canadian Charities and Terrorism - Preventing Abuse of your favourite charity” - http://www.capacitybuilders.ca/files/resources/Canadian_Charities_and_Terrorism_-_Preventing_Abuse_of_Your_Favourite_Charity_1262115622.pdf

read more

March 05, 2010

Federal Government Budget increases foreign aid by 8% this year

The March 4, 2010 Federal budget increased Canada’s foreign aid or “International Assistance Envelope” by 8% for the 2010/2011 year.  The government has said that it will review thereafter whether there is any increase.  In light of the difficult financial circumstances in Canada this is a good news story.  Hopefully the government will continue in future years to increase the budget as Canada is a wealthy nation and we are still far below the 0.7 gross national income target.  There will also hopefully be greater transparency at CIDA and in the aid process so that Canadians and others can understand how their money is being spent and how decisions are arrived at to spend that money.

read more

Topics: Global Giving | CIDA

March 04, 2010

Canadian Budget 2010 announces disbursement quota reform for Canadian charities

The Canadian federal government announced disbursement quota reform in the 2010 Budget to remove the 80/20 expenditure requirement for registered Canadian charities.  For many charities this will have no real impact - they were handily satisfying their disbursement quota requirements and for those that were not (except in extreme cases) CRA was not using the DQ to revoke charitable status.  As one observer noted on the changes “No more 80/20 ordinary gift. No more enduring property, including 10 year gifts. No more specified gifts. No more intercharity transfer rules based on original DQ designation. Just a simple obligation to use the equivalent of 3.5% based on previous 24 month market average for charitable purposes. ... The 3.5% obligation doesn’t kick in for charitable organizations until there is $100k in assets, while for foundations it stays at $25k.”  We will probably have a revised T3010 at some point to reflect these changes and one can expect with the simpler formula that in the future CRA will more vigorously enforce the DQ provisions as this will be easier to understand.  There is no cost associated with this change and a number of other proposals to increase tax incentives from some organizations were not included in the budget, which makes sense in light of the difficult fiscal situation in addition to other reasons.

read more

March 04, 2010

Free Workshop on Results-Based Management and Gender Equality

Plan Canada Presents: 4-day Advanced Training Session in Results-Based Management and Gender Equality
Toronto, Ontario April 6th-9th 2010

 

read more

March 04, 2010

Charities Directorate of CRA now displaying T3010 information for revoked charities

The CRA has just announced that “The Charities Directorate is now displaying T3010 returns for revoked charities, and detail pages for annulled charities in the Charities Listings.”

read more

March 02, 2010

CRA comments on gift to charity under will that is poorly drafted

This letter from CRA is a reminder that when leaving funds to a registered charity under a will the drafting is important.

read more

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

Contact

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
Download vCard

Connect

Locate

Blumberg Segal LLP
Barristers & Solicitors
#1202 - 390 Bay Street
Toronto, Ontario
M5H 2Y2 Canada

Charity Law List

Join Blumbergs' non-profit and charities newsletter
View recent issue: August 2014