The CRA has just published a sample: T3010B, Registered Charity Information Return, with accompanying forms and financial statements. This will be very helpful to charities as the T3010B is a new form.
If you are looking for a sample financial statement for a Canadian charity CRA has just published one of their website. Every Canadian charity in addition to filing the T3010 Registered Charity Information Return needs to file with that return a financial statement.
CRA has been piloting charity webinars recently. I understand that they have had a very good reception and that on the last e-mail announcement 400 people signed up in less than 2 hours. Here is information on their past webinars and future ones if you are interested.
Here is the latest CRA Registered Charity Newsletter # 32. It includes an extensive discussion on applications for charity status and how to improve your application and avoid unnecessary delays. It sets out the procedures that CRA will follow upon receiving a charity application.
This case deals with a church who lost its charitable status for lack of proper record keeping. We learn from this case that because CRA moves quickly to revoke status does not mean that the “requirements of natural justice and procedural fairness” are not respected. In this case the court found that the appellant was given several opportunities to respond to the concerns that CRA and they in their response did not satisfy CRA.
In the Christ Apostolic Church of God Mission International v. Canada (National Revenue) (2009 FCA 162) A-287-08, Date: May 20, 2009 the Federal Court of Appeal upheld a revocation by the Canada Revenue Agency of this church’s charitable status. This church had signed a “compliance agreement” and then the CRA withdrew the compliance agreement after an audit that showed non-compliance by the church. The court concluded “It was open to the Minister, after reviewing the audit report, to conclude that the appellant’s non-compliance was so substantial that it could not be remedied by the promises made by the appellant in the compliance agreement.” Organizations that sign a compliance agreement must remember they will be held to a high standard and they must be extra careful to abide by the provisions of the compliance agreement. As well if you sign a compliance agreement during an audit and at the end of the audit the CRA or the Minister after receiving the report decide that the conduct was particulary problematic they may revoke the compliance agreement and move to take away the charity’s status. Many charities view a compliance agreement as the end of their worries - in fact signing a compliance agreement is the beginning of a path of having to run a charity at a much higher level than what was done before or you will almost certainly in the near future lose your charitable status.
CRA just advised that certain T3010 forms on their Charities and Giving Web site, have been improved so that they are now saveable in addition to being fillable. By downloading the fillable/saveable PDF version of the form charities can save their work as they go, print the completed form and mail it to the Charities Directorate.
What are the hallmarks of a good charity. Boy that is hard. Easier to know what are the hallmarks of a bad charity. Well luckily the UK Charity Commission has come up with the following 6 hallmarks for a good charity. Except for the English accent, these hallmarks would seem to be equally relevant and useful here in Canada. Staff and directors of charities might find it useful to read the hallmarks and ask ‘does our charity live up to this?’. By the way this is not pass/fail - it is more a matter of continual improvement no matter how good we are.
Another title could be “Maple Syrup Business is not always charitable”. Many American comedians were concerned with the departure of George Bush that they would not have jobs, or at least their jobs would become more difficult. Never fear- if there is nothing to laugh at in the US you can always come up to Canada. In The House of Holy God case the courts had to work really hard to decide whether a charity registered for advancement of religion could be solely engaged in the business of producing and selling maple syrup and maple syrup products. The court found on the particular facts that the maple syrup business with paid employees is not a related business, and because it was run by paid employees (not 90% volunteers) it was not allowable. The Court noted “In particular, the record does not contain any evidence that the carrying on of a maple syrup business is an element of religious doctrine.” Registered charities need remember that even if all of the profits of the business are dedicated to charitable objects that does not make it a related business that can be carried out by the charity. The Court did not find CRA’s conclusion that the maple syrup business is not a related business unreasonable.
There is an interesting article in a newsletter entitled Global Trends in NGO Law published by the International Center for Not-for-Profit Law. In this article it discusses how many countries are restricting charities and philanthropists from funding projects or operating on their soil.
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If you require legal advice with respect to Canadian or Ontario non-profits or charities please contact Mark Blumberg at .(JavaScript must be enabled to view this email address) or at 416-361-1982 x237 www.canadiancharitylaw.ca