CRA launches new video series on charities and political activities

April 26, 2014 | By: .(JavaScript must be enabled to view this email address) Mark Blumberg
Topics: News, What's New from the Charities Directorate of CRA, Canadian Charity Law, Ethics and Canadian Charities

The CRA has prepared a new video series entitled "Charities and their participation in political activities".  It has 3 videos which are each about 3 minutes long.  There has been  a great deal of interest in political activities and charities over the last couple of years.  I would recommend that charities listen to these CRA videos.   I will also point out that I recently did a 25 minute video on political activities for the Maytree Foundation that some may also find useful.   

Here is a link to the 3 CRA videos on political activities

 Here are the transcripts of the 3 videos:

Video 1: Overview of Political Activities for charities  Video length: 3 minutes, 8 second

If you’re watching this video, chances are that you’re involved with one of Canada’s registered charities or you’re interested in knowing how Canadian charities are regulated. This video is one of three brought to you by the Canada Revenue Agency about charities and their participation in political activities.

A registered charity is an organization registered with the Canada Revenue Agency, focused exclusively on charitable purposes.  An important part of the Canadian social fabric, registered charities are involved in relieving poverty, advancing education or religion, promoting the arts, providing health care, conducting research, and more.

Registered charities don’t have to pay income tax, and are able to issue official donation receipts to donors. But, to keep these advantages, the Income Tax Act lays out some very specific rules about how they must conduct their activities.

These rules concern how a charity can use its resources. Resources are anything that a charity owns or controls, such as money, buildings, or volunteer time.

Charities in Canada are uniquely positioned to contribute to the development of public policy. Front-line experience in their field of operations gives them valuable insight that can help inform public debate and government decision-making.

Considering this, the Income Tax Act permits any charity to carry out a limited amount of non-partisan political activity in support of its charitable purposes. For those charities that choose to become involved in political activities, the law is clear: charitable purposes must always come first. Political activities can only be a minor focus, serving to support an organization’s charitable purpose.

A charity that doesn’t comply with these rules can face serious consequences, including having its charitable status revoked. Whenever appropriate, the CRA follows an education-first approach to help charities comply with the rules.  However, in severe circumstances a charity’s registration may be revoked. 

Simply put, charities are not political entities. At the end of the day, it’s really about staying focused and using all resources for the purposes the charity was registered for in the first place.

Visit the Canada Revenue Agency’s webpage called “Resources for Charities about Political activities.” You’ll find information sheets, guidance, a self-assessment tool, and questions and answers about political activities and Canada’s charities. 

This video is part of the Canada Revenue Agency’s balanced program of education and responsible enforcement to make sure that if a charity is carrying out political activities, it is doing so in a manner that complies with the law. The next video in the series addresses what is considered to be a political activity for registered charities. 

Video 2: What is a political activity?  Video length: 2 minutes, 46 second

Transcript

This video provides a brief introduction to the definition of political activities for a charity. It’s the second of three videos brought to you by the Canada Revenue Agency on registered charities and political activities.

A political activity is considered to be any activity that tries to change, retain, or oppose a law, decision, or policy of any government.

For example:

a charity formed to increase traffic safety might set up an online petition urging a province’s minister of transportation to lower speed limits on highways;
a charity that helps senior citizens might put out a message on its website arguing that the city council should reduce bus fares for seniors; 
a charity set up to protect endangered animals might tell tourists to boycott a country, with its internal communications showing that the point of the boycott is to pressure that country’s government to increase legal protection of its wildlife;
a charity might make a gift to another charity that helps senior citizens and say the gift is for its campaign to encourage city council to reduce bus fares for seniors.

However, if a charity decides not to engage the public, and instead makes a representation only to government,this is generally considered charitable and not political. This allows charities to provide their experience and expertise directly to public officials and elected representatives, as long as representations to government remain a minor focus of the charity and support its charitable purposes.  

For example, a charity that runs a food bank might set up a meeting with a federal Member of Parliament to urge her to push for increased employment insurance benefits for people who are out of work. This would be considered a charitable activity, even if the charity’s goal is to try to change the law.

Visit the Canada Revenue Agency’s webpage called “Resources for Charities about Political activities.” You’ll find information sheets, guidance, a self-assessment tool, and questions and answers about political activities and Canada’s charities.

This video is part of the Canada Revenue Agency’s balanced program of education and responsible enforcement to make sure that if a charity is carrying out political activities, they are doing so in a manner that complies with the law. The next video in the series addresses the legal requirement for a charity to operate in a non-partisan manner.

Video 3: Charities must always be non-partisan.    Video length: 2 minutes, 46 second

Transcript

This video provides a brief introduction to the legal requirement that a charity must always remain non-partisan. It’s the third of three videos brought to you by the Canada Revenue Agency on registered charities and political activities.

A political activity is considered to be any activity that tries to change, retain, or oppose a law, policy or decision of any government.

Charities can carry out a limited amount of political activities in support of their charitable purpose, and there are specific limits on those political activities:

A charity’s charitable purposes must always come first – charities are not political entities. A charity’s political activities must always be a minor focus of the organization, and serve only to support the charity’s charitable purposes.
While charities have a great deal of expertise and experience to offer to the ongoing discussion on public policy, a long-standing requirement of the law is that a charity must be non-partisan.

“Non-partisan” has a specific meaning when it comes to charities: it means that charities must never use any resources to directly or indirectly support or oppose any political party or candidate for public office. By resources, we mean anything that a charity owns or controls, such as money, buildings, or staff or volunteer time. For instance, a charity must never make a campaign donation to a political party, or tell its volunteers to help out on a candidate’s bid for election.

But being non-partisan means more than just staying out of direct involvement in elections: it also means that when a charity shares its views on a policy, law, or issue, it must not connect those views with any particular political party or candidate.

For example, an educational charity could say publicly that Canada’s provincial governments should all adopt a general policy of building more schools, and by itself this would probably be an acceptable political activity. But if its statement also congratulated a certain political party in a particular province for also supporting such a policy, this would be considered partisan. 

A charity carrying out any partisan activity could face serious consequences, including losing its registered status.

This video is part of the Canada Revenue Agency’s balanced program of education and responsible enforcement to make sure that if a charity is carrying out political activities, they are doing so in a manner that complies with the law.

Visit the Canada Revenue Agency’s webpage called “Resources for charities about political activities.” You’ll find information sheets, guidance, a self-assessment tool, and questions and answers about political activities and Canada’s charities.

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.

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