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

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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 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 requirement.  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. 

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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

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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.”

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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.

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February 24, 2010

International Pentecostal Ministry Fellowship of Toronto v. The Queen - (FCA) important case

In International Pentecostal Ministry Fellowship of Toronto v. The Queen (FCA) located at http://decisions.fca-caf.gc.ca/en/2010/2010fca51/2010fca51.html the Federal Court of Appeal confirmed CRA’s jurisdiction over Canadian charities registered under the Income Tax Act (Canada).  In quite a strongly worded statement the decision states “We have not been persuaded that there is any merit to the Appellant’s argument that the provisions of the ITA dealing with the registration and deregistration of charities are an unconstitutional infringement on provincial legislative authority. In our view, these provisions relate, in their pith and substance, to federal taxation, and accordingly they are intra vires the Parliament of Canada under subsection 91 (3) of the Constitution Act, 1867. Both the advantages of registration and the drawbacks of revocation relate solely to the tax treatment of charities and their donors. They do not impermissibly affect the affairs of charities in any other way, nor do they impede provinces from otherwise regulating charities.”  The court also rejected the charity’s argument that CRA by going to revocation did not follow its own guidance.  The court noted that CRA’s “decision falls squarely within the range of acceptable outcomes.” and that “it was reasonably open to the Minister to find the breaches sufficiently serious as to warrant revocation.”  This is important victory for charities and CRA in that it makes it clear that CRA can remove the charitable status of a sufficiently non-compliant charity. The public in Canada expects CRA as a regulator to regulate and sometimes that means removing the registered charitable status of groups that do not comply with the basic requirements of being a charity.  I would also commend the Federal Court of Appeal for the length of decision.  When a charity is making an argument that lacks “any merit” you don’t need a 20 page decision and a couple pages will do.

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February 23, 2010

Being Good at Doing Good Charity Conference in Toronto was a great conference

Just finished help organize the Being Good at Doing Good Conference organized by the Charity Law Information Program (CLIP) and supported by the Charities Directorate of the Canada Revenue Agency through its Charities Partnership and Outreach Program.  Thank you to CRA and Mackenzie Financial for sponsoring.  Thank you to all the CLIP and Capacity Builders staff who worked so hard on this project.  Also thanks go to all the speakers, especially those that came from afar,

February 21, 2010

Free Webinars on Canadian charity law - Charity Law Information Program (CLIP) by Mark Blumberg

Here are some archived webinars that the Charity Law Information Program (CLIP) and Blumbergs are beta testing.  Try them out and let us know if there are problems.  Please e-mail .(JavaScript must be enabled to view this email address) with any comments. CLIP is supported by a contribution from the Charities Directorate of the Canada Revenue Agency. 

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February 17, 2010

How do you know if your Canadian non-profit is not really a charity under 149.1(l) of the ITA?

CRA provides their answer in this piece from the APFF 2009 Conference.

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