There has been some confusion over when conduct that is a main or independent purpose of the charity in terms of CRA’s Fundraising Guidance.
CRA in its guidance notes:
“b) Conduct that is a main or independent purpose of the charity
Although fundraising may sometimes be stated as a charity’s ancillary and incidental purpose, registered charities cannot have fundraising as a main or independent purpose, even if secondary. A main or independent purpose of a charity is often described as a collateral purpose. When more of a charity’s time, effort, and other resources are devoted to its fundraising rather than to carrying out its broader charitable purposes, this is a strong indication that fundraising is a collateral purpose.
Registered charities can only raise funds that are necessary to fulfill their mandate. Fundraising activities are sometimes undertaken by registered charities in hopes of generating extra resources, without first determining what charitable work needs to be achieved and what resources are needed to do that work.
Foundations are generally established to fund qualified donees, which includes charitable organizations. The Income Tax Act’s definition of charitable purposes includes the disbursement of funds to qualified donees. Thus, whereas charitable organizations engage directly in the delivery of charitable activities, foundations whose purposes include funding qualified donees also engage in charitable activities by disbursing funds to qualified donees.”
To review the CRA Fundraising Guidance see “How do I find the CRA Guidance on Fundraising for Canadian charities?” at
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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.