Today, CRA released it’s new Guidance, CG-029, Relief of poverty and charitable registration. This relatively short guidance provides some useful information on what CRA considers to be charitable activities that relieve poverty. As so many charities are involved with relief of poverty it will probably become a widely read guidance.

Here is the summary from the new guidance:

Summary

The relief of poverty is a recognized charitable purpose category. To be a registered charity under the relief of poverty category, organizations must show both of the following:

  • their beneficiaries are experiencing poverty
  • their activities provide a charitable benefit that relieves the poverty of their beneficiaries

Poverty is a relative term and there is no complete definition of poverty in charity law. For the Charities Directorate’s purposes, people experiencing poverty are those who do not have the ability to acquire the basic necessities of life or simple amenities that are seen as necessary for a modest but adequate standard of living. In Canada this can include providing internet access, appliances, and passes for public transportation.

Depending on the value of the benefit being provided, the frequency of the benefit, and an organization’s operational circumstances, the organization may also need to establish criteria to evaluate its beneficiaries to make sure that they need poverty relief. To establish appropriate criteria, charities may use recognized poverty indicators or they may establish their own criteria.

Although charities can be established to relieve poverty, they cannot be established to prevent poverty. Preventing poverty implies that the beneficiaries are not experiencing poverty, a requirement for beneficiaries under the relief of poverty category. However, charities can have activities that have the effect of preventing poverty. Such activities typically advance purposes in one or more of the other charitable categories where the beneficiaries are not restricted to those that are poor (the advancement of education, the advancement of religion, or other purposes beneficial to the community).

 

it also covers various topics including: