September 2010
Here are some of the upcoming charity law seminars I will be presenting through the Charity Law Information Program. More dates and details will be announced. For obvious budgetary reasons I can only visit some places every 2-3 years, so check the list and avoid disappointment!! http://www.capacitybuilders.ca/clip/clip-training-events.php A full day session is $40 - great value for charities, their staff and boards of directors
Posted by
.(JavaScript must be enabled to view this email address) on 09/02/2010 |
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There was an article this week by Janet Gadeski, Editor of Canadian Fundraising & Philanthropy talking about GlobalPhilanthropy.ca (TM), its roots and mission. http://www.canadianfundraiser.com/newsletter/article.asp?ArticleID=3409&ClientID=1
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.(JavaScript must be enabled to view this email address) on 09/01/2010 |
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Canadian Charity Law
Here is information on some upcoming presentations I am doing with the Certified Management Accountants of Ontario on Top Compliance Issues for Canadian Registered Charities and their Directors in the GTA including Toronto, Mississauga, Markam, in the Kitchener-Waterloo area, in London, and in Ottawa.
August 2010
It is good to see that the problem of abusive charity gifting tax shelter in 2009 has been further reduced. Here are the stats from CRA:
Posted by
.(JavaScript must be enabled to view this email address) on 08/29/2010 |
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Here is a CRA letter on Canadian unincorporated associations and who should pay tax if no longer meeting requirements for tax exemption.
Posted by
.(JavaScript must be enabled to view this email address) on 08/29/2010 |
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One of the categories of qualified donees under proposed legislation is a municipal or public bodies performing a function of government in Canada. Here is a CRA letter on whether an Indian band is a public body performing a function of government as is used in paragraph 149(1)(c) of the Income Tax Act? It also discusses whether a subsidiary is tax exempt.
Posted by
.(JavaScript must be enabled to view this email address) on 08/25/2010 |
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A bill to impose a salary cap on Canadian registered charties has passed 2nd reading and will shortly be reviewed by the Finance committee of the House of Commons. As they say there is usually one simple solution to a complex problem that is totally wrong. To have a single cap for all Canadian charities means that Canadian hospitals, research institutions, and universities will not even have a chance of being able to compete with other similar institutions around the world. While it sounds appealing to cap salaries at $250,000 it is actually when you drill down to the details a very problematic piece of legislation. You see it is not about what charities want to pay for things - every charity would ideally want everything for free. Charities need to able to recruit people to accomplish their mission. Charities should never pay more than they need to. They should never pay more than fair market compensation. But you cannot just put a one-size fits all number on what it is? When there are only a few neurosurgeons you cannot pay what you want - you need to pay something related to the going rate for neurosurgeons or be prepared to do without them. If you are a small community in the North and you want to have a specialist in your community you may have to pay that person more than a comparable hospital in Toronto or Chicago.
Here is a link to CRA’s new page “Floods in Pakistan” http://www.cra-arc.gc.ca/whtsnw/tms/pkstn-fldng-eng.html It also has links to CIDA’s matching program.
Posted by
.(JavaScript must be enabled to view this email address) on 08/23/2010 |
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CIDA has announced that it will have a matching fund for donations raised by Canadian charities for the Pakistan relief from August 2 to September 12. The Pakistan Floods Relief Fund will not be given to each charity that raised funds but instead there will be an application process in which charities can apply for the funds and they will have to demonstrate that they have the capacity to do the work effectively. This is similar to the Haiti eartquake fund a few months ago.
Posted by
.(JavaScript must be enabled to view this email address) on 08/22/2010 |
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CanadaHelps is offering a number of free training seminars for charities. They look very interesting and here are the details:
Posted by
.(JavaScript must be enabled to view this email address) on 08/21/2010 |
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Here are some of my notes on my learnings at the CIVICUS World Assembly 2010 that I am attending in Montreal.
Posted by
.(JavaScript must be enabled to view this email address) on 08/20/2010 |
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For those who could not attend the CIDA presentation today in Toronto here is a copy of the CIDA presentation and material on Partnership with Canadians Branch- August 2010. There are some questions posed in this document that CIDA is looking for input by Wednesday August 25.
Posted by
.(JavaScript must be enabled to view this email address) on 08/18/2010 |
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This document contains a list of countries and regions in which Canadian charities are conducting foreign activities. The information comes from the 2008 T3010 Registered Charity Information Return and specifically Question C5: “For programs the charity managed directly, outside of Canada, list the countries or regions where programs were carried on. Do not include countries or regions where programs were managed by a qualified donee.” Here is the list of Canadian Charities that Operate Abroad listed by Country and Region based on 2008 T3010 information.
Posted by
.(JavaScript must be enabled to view this email address) on 08/17/2010 |
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Here is a request from the Humanitarian Coalition with respect to Pakistan http://thehumanitariancoalitionenglish.cmail4.com/t/y/e/miritl/biljdktji/ Here are some blogs and pictures from Pakistan http://www.thehumanitariancoalition.ca/index.php/site/newsRoomArticle/blogs_and_info_from_pakistan/ The Humanitarian Coalition is made up of Care Canada, Oxfam Quebec, Oxfam Canada and Save the Children. They fundraise and work together in major international disasters to be more efficient, effective, and coordinated.
Posted by
.(JavaScript must be enabled to view this email address) on 08/16/2010 |
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Here is an interesting guide for those involved with funding NGOs around the world. Don’t be put off by the title - you may still be intelligent even if you don’t follow all the principles!
Posted by
.(JavaScript must be enabled to view this email address) on 08/15/2010 |
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I will be one of the presenters at an upcoming PFC program called Global Giving - Possibilities and Pitfalls.
Posted by
.(JavaScript must be enabled to view this email address) on 08/11/2010 |
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Here is an article on the Chronicle of Philanthropy about New York State’s new law limiting deductions for donors who earn over 10 million http://philanthropy.com/article/NY-Governor-Signs/123863/ It is thought that other states as well as the Federal government may follow this example. There are some that argue the the more the merrier when it comes to tax incentives for people giving to charity. However, as New York is seeing the greater the tax incentives for general charitable giving the greater foregone revenue needed to run basic government services. This may be a ‘luxury’ they cannot afford. Also while some donors are fixated on tax rates - for most according to a number of surveys tax barely figures in the equation. Will Canada follow NY’s example? We will see.
Posted by
.(JavaScript must be enabled to view this email address) on 08/11/2010 |
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The 4th annual Artez InterAction one day conference is coming up on September 28, 2010 at the Mars centre in Toronto. There are lots of good speakers but make sure you catch Claire Kerr - she is a very funny lady! For more information see: http://www.artez.com/news_and_events/conferences/artezinteraction_north_america/conference_sessions
Posted by
.(JavaScript must be enabled to view this email address) on 08/09/2010 |
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Tomorrow, the Humanitarian Coalition will launch an appeal for flooded Pakistan. Here is a link to their website http://tiny.cc/rr9x7 For those who have not heard of the Humanitarian Coalition it is “a network of Canadian NGOs determined to unite in cases of humanitarian crises. Four of Canada’s leading aid organizations have founded the Humanitarian Coalition: CARE Canada, Oxfam Canada, Oxfam-Québec and Save the Children Canada.”
Posted by
.(JavaScript must be enabled to view this email address) on 08/09/2010 |
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Here is the segment (2.5 minutes) with Sean O’Shea, a consumer reporter for Global TV. Mark Blumberg, moi, is being interviewed along with much more serious, important, and influential characters such as Marcel Lauzière of Imagine Canada http://www.globaltoronto.com/Video+Donor+beware/3378491/story.html
The case involves the CRA denial of EFILING privileges to Mr. Christopher Paterson, an individual who prepares clients’ returns because he assisted them with a “scheme” in which the applicant “accepted money from taxpayers who wished to “donate” to these charitable organizations in exchange for an “enhanced receipt” for tax purposes (the scheme). The receipt provided to the taxpayer would reflect a much larger sum of money than was actually paid and would then be used in the preparation of the client’s tax return to provide the client with sizeable deductions from their taxable income.” Mr. Paterson had objected to the CRA determination and the Federal Court upheld the CRA decision. The CRA Chief of Appeals had noted “[The applicant’s] conduct was disreputable in nature because of [his] involvement in selling charitable donation receipts to [his] clients for gain. Further, [he] knowingly prepared returns using these donations receipts from which there were no actual contributions to the registered charities. As a result, [the CRA] find[s] that [his] conduct in this matter does not reflect positively on the integrity of the EFILE program…” The court noted “While the applicant may not have had any reason to question the authenticity of the receipts his clients were being supplied, he most definitely knew that the amounts paid by his clients were not equal to the amounts they were given credit for when he was completing their income tax returns. There was evidently some sort of wilful blindness on the part of the applicant. The mere fact that the applicant did not believe this to be fraudulent does not detract from his admission that he participated in a scheme whereby taxpayers were making claims for the deduction of sums of money they never paid to these charitable organizations. As it is often said, ignorance of the law is no excuse.”
Posted by
.(JavaScript must be enabled to view this email address) on 08/08/2010 |
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The New York Times reported that “Returning home from a three-week trek on foot to deliver free medical care to the remotest regions of the country, the aid workers — six Americans, a Briton, a German and four Afghans — had just finished eating when they were accosted by gunmen with long dyed-red beards, the police said. The gunmen marched them into the forest, stood them in a line and shot 10 of them one by one.” ...“The attack, the largest massacre in years of aid workers in Afghanistan, offered chilling evidence of the increasing insecurity in the northern part of the country and added to fears that the insurgency has turned even more vicious in recent months.”
Posted by
.(JavaScript must be enabled to view this email address) on 08/04/2010 |
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The Kootenay Doukhobor Historical Society v. The Queen case illustrates quite well that even if a non-profit and a staff person agree that the staff person is an independent contractor, there is an independent contractor agreement, and the staff person has considerable latitude in carrying out the tasks, the staff person can be found to be an employee. It is vital that non-profits and charities properly categorize staff. Failure to consider someone an employee when they really are an employee, and failure to withhold EI, CPP and income tax amounts, can result in considerable liability for a non-profit or charity. As well, directors of the non-profit or charity can be on the hook for the outstanding amount and this is probably the most common reason that the directors of a non-profit or charity would ever have personal liability.
Here is a list with the 2008, 2009 and 2010 major deregistrations along with a link to the CRA press release and scanned copies of the actual letters sent by CRA to the charities outlining their reasons for revoking or annulling their charitable status.
CRA has just released a new guidance called “Canadian Registered Charities Carrying out Activities Outside Canada”. http://www.cra-arc.gc.ca/chrts-gvng/chrts/plcy/cgd/tsd-cnd-eng.html Although the name suggests “foreign activities” this document deals with a lot more than foreign activities. It covers the relationship between a Canadian charity and any non-qualified donee, whether in Canada or abroad. If a Canadian charity has dealing with, for example, a non-profit that does not have charitable status then the same rules apply as a Canadian charity dealing with a foreign entity. Essentially, almost all organizations outside of Canada are non-qualified donees. If you are going to transfer resources to them you need to maintain “direction and control” over those resources. This documents helps a Canadian charity understand what is required for direction and control. Failure to maintain direction and control can result in a 105% penalty of the amount transfered and/or revocation of charitable status.
July 2010
Posted by
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Here is a press release in which CIDA Minister Bev Oda announces further steps to achieve aid effectiveness. http://www.acdi-cida.gc.ca/acdi-cida/ACDI-CIDA.nsf/eng/CEC-722111726-KXG There is also a backgrounder. This document is a must read for any organization receiving CIDA funds or hoping to one day. There is a lot in this document and it will be interesting to see if practically this make any real difference at CIDA.
Posted by
.(JavaScript must be enabled to view this email address) on 07/29/2010 |
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With the recent changes in the 2010 Federal budget including the elimination of the 80/20 expenditure rule it became necessary for CRA to revise the T3010 Registered Charity Information Return.
Here is a copy of my presentation to the Ontario Council For International Cooperation (OCIC) on “Advocacy and Political Activities for Canadian International Development Charities: Some Legal and Ethical Perspectives”.
Posted by
.(JavaScript must be enabled to view this email address) on 07/27/2010 |
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Avoiding 'Charity' Scams
There was recently an interesting case “Innovative Gifting Inc. v. House of the Good Shepherd” that involved charities. This was not a case involving the Federal Court of Appeal or Tax Court - the usual places charity law issues are dealt with. This case was in the regular Ontario court system - some “fundraisers” called Innovative Gifting were trying to enforce an agreement they had with a number of Canadian charities. The long and the short of it, the court would not enforce the agreements as they found them to be void or voidable because they were counter to public policy and the agreements were “vague, uncertain and filled with inherent inconsistencies”.
