What's New from the Charities Directorate of CRA
November 03, 2019
Blumbergs is pleased to announce that we will be hosting Blumbergs' Canadian Charity Law Boot Camp again on Monday April 20, 2020. An easy enough date to remember! This is a one-day boot camp on compliance and standards issues for Canadian registered charities. You can find out more information and register for the program here. This Boot Camp will cover the differences between for-profits, non-profits and registered charities and why in some cases you may wish to have one or more of each to have maximum impact. It will focus on matters that are significant for any operating charity surrounding revenue generation rules, receipting, transparency, and protecting your charity against risks. Topical issues such as collaboration, foreign activities, political activities, the Canada Not-for-Profit Corporations Act (CNCA) and Ontario Non-Profit Corporations Act (ONCA) will be touched upon as well.
October 25, 2019
There was a recent Tax Court of Canada ("TCC") case Miller v. The Queen, 2019 TCC 204. It is not an important or exciting case - it deals with a charity tax scheme. A person buys some multimedia courseware for $7000 then claims that the fair market value is $42,000. We have seen lots of those types of cases and CRA has been successful in court over denying the deductions. What is most interesting to me is that the "donation" was in late 2003 and we are now in late 2019. It has taken this case about 15 years to be heard by the TCC.
October 15, 2019
CRA is now sending out reminders to registered charities to file their T3010s on time. This reminders are going out roughly 3 months before the charity's T3010 due date. Here is a redacted copy of the notice.
October 12, 2019
Here are some documents relating to social finance, social investments and social enterprise that have been requested by various people through the Canadian access to information system from the Canadian Federal Government. These documents are probably of interest to some who are in the social finance and social enterprise space.
October 08, 2019
The Canadian Charity Law Association is delivering some upcoming webinars. Registration is free but space is limited. Topics are subject to change.
October 02, 2019
There is an interesting letter from CRA dealing with "Whether an employer's contribution to an employee's crowdfunding campaign raising funds to help with additional costs for caring for their child, who was born with XXXXXXXXXX, is a taxable benefit." The CRA provides an outline of the factors to be considered. CRA notes that it is ultimately a question of fact - are the funds a "voluntary contributions received by an individual in their personal capacity" and if so they are generally not required to be included in income as opposed to employment income or disguised remuneration. The employer would also not get to deduct the funds provided to the crowdfunding campaign as a business expense.
September 27, 2019
I have been asking the Ontario government for months for an update on whether ONCA is coming into force and when. On September 25, 2019 I received a short note from the Policy and Business Law Unit of the Ministry of Government and Consumer Services (MGCS). They noted "Thank you for your inquiry to the ministry regarding the Ontario Not-For-Profit Corporations Act (ONCA). The ministry is working to bring ONCA into force as early as possible." In January 2019 they noted "The ministry is continuing to work to bring the ONCA into force as early as possible with a target of early 2020".[my emphasis] Note they seem to be omitting the part about targeting early 2020. I guess we are supposed to read the tea leaves - does that mean that it will be coming in early 2020, some other time or not coming in at all. Your guess is as good as anyone.
September 22, 2019
Join us on Monday October 7, 2019 in Toronto for the 8th Annual Blumbergs' Canadian Charity Law Institute. We will be featuring a number of speakers covering different legal and compliance issues affecting Canadian charities and non-profits. It will be a full day packed with practical legal and ethical compliance information geared toward charities, professional advisors and those interested in regulatory issues affecting charities and the non-profit sector. Space is limited. Here is the agenda.
The price is $275 for the day. It includes breakfast, lunch, breaks, coffee and drinks, HST and handouts. For more information (including the agenda) or to register here is a link to the Blumbergs' Canadian Charity Law Institute 2019.
September 21, 2019
CRA is encouraging non-profits that want to apply to become registered charities to use their new CHAMP system for the application process. They recently made an announcement that they will still however accept paper applications using the old Form T2050 until September 30, 2019. It is not clear whether they will not accept paper applications after that date or if they really want you to use CHAMP but they will accept a newer paper form called the T1789 (E) 19 for those who cannot access the CHAMP system. We will see. No doubt it is better for CRA and obtaining a timely response from CRA to use the online system but in light of the current challenges that some are having with that system they may still for a while continue to accept paper applications even if it slows down the process. We have been using a mix of online and paper applications depending on the client and whether they can authorize our firm to access their RR number on CHAMP.
August 29, 2019
CANADALAND recently had a podcast which dealt with a number of topics but one of them was charities, political activities, Elections Canada and the upcoming Federal election. The podcast was called "#227 Scandal? What Scandal?". In the podcast Jesse Brown is joined by Sandy Garossino, a former Crown prosecutor and columnist for the National Observer. The discussion on charities and political activities takes place around 25:08 minutes in.
August 27, 2019
STEP Canada had a CRA Roundtable on June 6-7, 2019 and they discussed a number of topics. One issue of interest to charities and philanthropists is Question 2 dealing with alter ego trusts and donations. Essentially CRA takes the position that if an alter ego trust is required to distribute its funds to a charity then such funds are not a charitable donation and not entitled to an official donation receipt. If on the other hand the trustees have discretion and there is donative intent then it could be a charitable contribution.
August 20, 2019
There has been a lot of media and social media coverage over the last few days about non-profits and charities and the rules around their involvement in the upcoming election. To my dismay, much of it has been inaccurate. While I am quite used to misinformation on the obligations of charities what is most interesting is the way in which "serious" media organizations such as CBC apparently made no attempt to actually check what the rules are and have put forward ridiculous ideas such 'if a charity registers as a third party with Elections Canada they could lose their charitable status'. As well while there are some new rules in the Canada Elections Act the main rules dealing with third party registration during an election have been around for decades.
July 28, 2019
CRA in June 2019 brought in a new charity application system under their CHAMP modernization program. Here is our article Making sense of CRAs new online Canadian charity application system which discusses the new system and also provides a paper copy of the questions on the new system. Some people, including professional advisors, have had challenges with the new system and hopefully this article will be of assistance.
We have a directory dealing with applications for charity status. If you wish to apply for charity status in Canada and need legal assistance you can retain our law firm to assist. Here is information on how to contact us. We have 9 lawyers who focus on working with non-profits and charities that are based in Canada and abroad.
July 26, 2019
The Journalism and Written Media Independent Panel of Experts released a report that they had provided to the Federal government relating to the 2019 federal budget and the proposals on journalism. Here is a copy of the report. As well here are minutes of their meetings.
July 24, 2019
On June 28, 2019, the Tax Court of Canada released its decision Promised Land Ministries v the Queen, in which it upheld CRA's decision to suspend the registered charity Promised Land Ministries ("PLM")'s receipting privileges for one year for failing to maintain adequate books and records over a foreign activity by the Canadian charity. This case is vital reading for any Canadian charity conducting foreign activities because of its extensive discussion of books and records and foreign activities.
July 18, 2019
Yesterday, CRA announced that Public Services and Procurement Canada (PSPC) has surplus items and PSPC is inviting registered charities interested in receiving items to identify themselves. Registered Charities should contact PSPC prior to August 30, 2019. Below is the full notice that we received from CRA:
June 28, 2019
We have created two new online courses for those outside of Toronto who are not able to easily attend our programs. They might also be helpful to those in Toronto who cannot wait for our next session as they sometimes only occur annually. Online course are never going to be the same as in-person courses but for many they are far easier to access and more convenient. You can do an online course at your pace and redo sections if you wish.
The first course is "Should We Establish a Canadian Social Enterprise, Non-Profit or Charity and How to Do It?". The course is $149 and you can register at https://charity-law.teachable.com/
The second course is "Receipting for Canadian Registered Charities". The course is $225 and you can register at https://charity-law.teachable.com/
June 27, 2019
Canadian charities now have more options for doing certain transactions online using the CHAMP system. Charities should look into accessing their CHAMP account.
June 15, 2019
I have just completed 4 years on the CRA's Technical Issues Working Group. Most people don't even know that it exists. The Technical Issues Working Group is fondly known as TIWG and pronounced like 'twig'. It is an opportunity twice a year for CRA, Finance, certain charities and professional advisors to discuss technical and other issues affecting the sector.
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