January 27, 2014

Which Canadian Registered Charities Received the Most Money from Municipal Governments in 2012?

We recently reviewed the T3010 information for 2012.  We looked at government funding and specifically which Canadian registered charities received the most funds from municipal governments. Please review my caveats at the end about the reliability and usage of T3010 information.

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January 11, 2014

Which Canadian Registered Charities Received the Most Money from Provincial Governments in 2012?

We recently looked at government funding and specifically which Canadian registered charities received the most funds from provincial governments in 2012.  Most government funding is from the provincial level of government and therefore provincial funding is vital for the Canadian charity sector.

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January 11, 2014

Did the University of Windsor spend $285 million on political activities in 2012

Probably not.  Otherwise that would be about 5-10 times more funds than all Canadian registered charities spent on political activities in 2012.  In fact, when we reviewed who spent the most on political activities it appears to me that the top 6 organizations were all mistakes.  Either CRA or the charity messed up when inputting the numbers.  All charities, but especially larger charities, should carefully review their T3010 before filing and also check that the CRA got the information correct a few months after filing.

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January 11, 2014

Shocking CRA press release on Canadian charity gifting tax shelters

The problem of “abusive charity gifting tax schemes” continues.  These are schemes that promise that if you put in say $1000 through a complicated scheme you will end up with a $5000 receipt and therefore you can save $2500 in taxes.  CRA notes that two additional strategies will be used to prevent Canadians from investing in these schemes.  The first is that CRA will not assess tax returns until after the tax shelter scheme has been reviewed.  That means a person who claims tax benefits under one of these schemes and then files a tax return may have to wait a couple years for a refund.  Also as per the 2013 budget CRA can collect 50% of the taxes owing of an amount in dispute.  What is shocking from the press release is apparently over 182,000 taxpayers have participated in these schemes.

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January 05, 2014

CRA releases list of “municipal or public body performing a function of government in Canada”

There is a category of qualified donee, ie. organizations that can issue tax receipts, called “municipal or public body performing a function of government in Canada”.  This group is largely first nations bands but also could include school districts or certain other types of entities.  CRA has just released the list and it contains 60 groups.  Hopefully the number will rise.  It is important for Aboriginal groups that need funding from foundations or wish to issue official donation receipts for gifts consider obtaining this status.  Here is a list of “municipal or public body performing a function of government in Canada”:

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January 04, 2014

Which Charities Received the Most Money from the Federal Government - 2012

I recently compiled a list of which Canadian charities received funds from the Canadian Federal Government.

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January 04, 2014

Largest Gifts from Canadian Charities to other Qualified Donees - 2012

We recently reviewed the 2012 T3010 Registered Charity Information Returns for largest inter charity gifts.  Here is a list of all gifts over $500,000 from the 2012 T3010.

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December 22, 2013

Blumbergs 2013 Receipting Kit for Canadian Registered Charities

We have updated the Blumbergs’ 2013 Receipting Kit.

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December 19, 2013

CRA requests “Donate wisely this holiday season!”

CRA is putting out better notices on donating wisely.  I particularly like this advice “Get to know the charity.” Start by visiting the charity’s website to learn about its activities and how it’s managed. You can also review its financial information and activities by looking at its information returns using the CRA’s Charity Quick View at www.cra.gc.ca/charitylists. One of the best ways to learn about a charity is to volunteer.”

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December 18, 2013

Prescient Foundation leave to appeal dismissed with costs by SCC

On November 28, 2013 the Supreme Court of Canada denied leave to appeal in the case of Prescient Foundation v. Minister of National Revenue.  The SCC awarded costs against the appellant.

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December 08, 2013

Kossow appeal dismissed by Federal Court of Appeal - another abusive donation scheme crashes

The Federal Court of Appeal has decisively dismissed the Kossow appeal.  Kossow dealt with what CRA would term an “abusive charity gifting tax scheme”.  Kossow is the second major case dealing with these schemes, the first one being Marechaux.  The Federal Court of Appeal found this scheme was almost identical to Marechaux.  The FCA concluded that the Tax Court judge was correct in concluding that as in Maréchaux there was no gift for purposes of the Income Tax Act.  The FCA also dismissed other arguments such as that the TCC judgement was ‘not sufficient to permit meaningful appellate review’ or that including certain materials that were not admitted into evidence prejudiced the appellant.  The court was also not impressed with an argument that a family law case (McNamee) dealing with a gift has any relevance to a gift under the Income Tax Act.  According to the CRA there are over $6 billion in receipts issued under different abusive charity gifting tax schemes.

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December 07, 2013

Interesting US article on churches and transparency/accountability

John Montague has written an article entitled “The Law and Financial Transparency in Churches: Reconsidering the Form 990 Exemptions” in the Cardozo Law Review.  In the US, churches don’t have to file the Form 990 annual return, however, in Canada almost all churches that are registered charities need to file the T3010 on an annual basis.  The US Form 990 provides the US public with far more information than the T3010 in Canada.  That being many of the points raised by Mr. Montague about church governance, accountability and transparency are relevant to Canada.  It is important in Canada that we review the T3010.  We should improve the T3010 to provide important information to donors, volunteers and others about registered charities.  While the T3010 does provide a fair amount of information, it tends to focus too much on certain issues while ignoring others.

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December 04, 2013

Partial exclusion for Canadian registered charities from anti-spam legislation

Industry released today draft regulations to Canada’s Anti-spam Legislation (CASL) which will now come into effect on July 1, 2014.  An important exclusion that will be welcomed by registered charities is that the Act does not apply to an electronic message “(g) that is sent by or on behalf of a registered charity as defined in subsection 248(1) of the Income Tax Act and

the message has as its primary purpose raising funds for the charity”.  Keep in mind that if a charity is sending a commercial electronic message and this or other exclusions do not apply, then CASL will apply to the registered charity.  The exclusion “its primary purpose raising funds for the charity” was introduced to cover situations were a fundraising email involved some commercial activity such as the sale of a gala dinner ticket.  However, if the email fits in the definition of a commercial electronic message but it has a number of purposes, and raising funds is not the primary purpose, and another exclusion does not apply, then CASL applies.  The key takeaway for registered charities is that they are not exempted from CASL and that they should try and ensure that they have express consent from as many people as possible.

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December 04, 2013

CRA reminds groups of December 31, 2013 deadline

The CRA put a reminder on their website today “Does your organization make its resources available to, or work with a municipal or public body performing a function of government in Canada, such as a First Nation? The December 31, 2013 deadline for registration of these bodies to maintain their qualified donee status is approaching. For more information, go to Municipal or public bodies performing a function of government in Canada.”

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November 26, 2013

More from the T3010-13 on political activities

I just reviewed the latest T3010 data disk for 2013 and here are the descriptions of activities for political activities by Canadian charities.  This is only based on 7900 of the approximately 86,000 charities.

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November 22, 2013

Emily Sowah v. The Queen - legislative requirements of charitable receipt not met

In this decision, Ms. Sowah appealed the Minister of National Revenue’s assessment of her 2006 taxation year in which her charitable donation claim was denied. The court found that the charitable receipts issued by the charity did not contain all of the required elements and failed on three counts.

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November 22, 2013

Ward Carson v. The Queen -can receipt be issued for “donation” of rooms in home?

In this decision, a taxpayer appealed the Minister of National Revenue’s denial of his claim for a charitable donation in 2009. The amount he claimed represented his estimate of the fair market value of the use by a registered charity of two rooms in his home (rent-free) over a two year period. The issue in this decision was whether the use by the charity of two rooms in Mr. Carson’s home, valued at $130 a month, represented a charitable gift from Mr. Carson to the registered charity, eligible for tax credits.

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November 12, 2013

Typhoon Haiyan - Canadian charities respond to humanitarian crisis

The Humanitarian Coalition has launched an appeal for Typhoon Haiyan which has killed many people in the Philippines and left many homeless.  “The Humanitarian Coalition is a joint appeal mechanism. It is comprised of CARE Canada, Oxfam Canada, Oxfam-Québec, Plan Canada and Save the Children. With a combined presence in more than 120 countries, we bring together Canada’s leading aid agencies to finance relief efforts in times of international humanitarian crises. We work together to eliminate unnecessary competition, reduce the duplication of fundraising costs, and inform the public on humanitarian needs.” DFATD has announced a matching fund for donations for Typhoon Haiyan.  There are approximately 620,000 Canadians of Filipino descent in Canada.  Many of them regularly send funds back to family and friends as remittances.  Many will also respond to this typhoon by sending funds home.  While remittances are not a charitable donation and do not receive any tax support from the Canadian government, they can be tremendously beneficial.  In fact all Canadian international philanthropy is $3 billion per year, while remittances to developing countries are around $15 billion per year. I will discuss further below.

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November 12, 2013

Saskatchewan introduces bill “The Informal Public Appeals Act”

Saskatchewan has introduced a bill that would regulate informal public appeals. This will cover situations like when a fire destroys a family home and funds are raised to help the family and what to do if there are excess funds etc.  Most importantly for charities the proposed legislation does not apply to qualified donees (i.e. registered charities, etc) and their fundraising.  This legislation will be helpful in a number of situations that commonly come up with informal appeals.  As is typical Saskatchewan leads the way!

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November 10, 2013

Blumbergs’ Snapshot of the Ontario Charity Sector 2011

We recently reviewed the T3010 Registered Charity Information Return database for 2011 as part of the Sean Blumberg Transparency Project.  We provided an overview of the whole charity sector in the Blumbergs’ Charity Sector Snapshot 2011.  We have taken a subset of the 2011 T3010 data to look at only registered charities based in Ontario.  This article provides a snapshot of the registered charity sector in Ontario based on the 2011 T3010 filings.  Here is a PDF of the Blumbergs’ Snapshot of the Ontario Charity Sector 2011.

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November 08, 2013

Finance Committee and pre-budget submissions and testimony

The Finance Committee of the House of Commons has been holding hearings.  A number of charities have presented.  Many charities have sent in submissions.

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November 08, 2013

Comments requested on Canadian Non-Profit accounting standards

The Accounting Standards Board and Public Sector Accounting Board are asking for comments by December 15, 2013 on some changes to the principles affecting non-profit accounting. 

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November 03, 2013

“Talking About Charities 2013” Public Opinion Poll Released

The Muttart Foundation has released the 2013 edition of its “Talking About Charities”.  It updates its last similar opinion poll from 5 years ago.

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Topics: Transparency

November 02, 2013

Partial Settlement of ParkLane Gift Program class action according to Paliare Roland website

At the website of the Toronto class action law firm Paliare Roland they have a note that “On Friday, October 18, 2013, the Ontario Superior Court of Justice approved the settlements with the Law Firm Defendants (including Edwin C. Harris Q.C.), and with the Funds for Canada Foundation, Mary-Lou Gleeson, Matt Gleeson and Gleeson Management Associates Inc. (the “FFCF/Gleeson Defendants”). ... The settlement with the FFCF/Gleeson Defendants is for $950,000, and requires them to co-operate in the ongoing prosecution of the action by producing documents and giving evidence.  The settlement with the Law Firm Defendants is for a minimum of $23,130,789 and a maximum of $27,242,843. The Law Firm Defendants will also be obliged to produce documents and give evidence.”  It will be interesting to see how the litigation proceeds.

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October 31, 2013

Peter Braid’s Bill on “National Charities Week” and to amend donation deadline has been withdrawn

Peter Braid on October 23, 2013 withdrew his bill entitled “An Act respecting a National Charities Week and to amend the Income Tax Act (charitable and other gifts)”.  We welcome the withdrawal of the private members bill as we, and a number of organizations, had expressed concerns with the private members bill, especially the idea of extending the deadline for charitable contributions, and the lack of consultation with the sector.

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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.

mark@blumbergs.ca
416.361.1982
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