Prescribed foreign universities can have their qualified donee status be revoked by the CRA

October 28, 2017 | By: .(JavaScript must be enabled to view this email address) Mark Blumberg
Topics: What's New from the Charities Directorate of CRA, Canadian Charity Law, Applying for Registered Charity Status, Receipting by Canadian Registered Charities, Fundraising Guidance for Registered Charities

Canada has an unusually generous system in which foreign universities that have a couple of Canadian students studying there can obtain the equivalent of Canadian registered charity status with almost none of the obligations. Here is an article describing that process.  However, CRA can remove charities from the list if they don't continue to meet the requirements (for example to have the 2 students) or they don't respond to CRA requests every 5-10 years for confirmation of information. 

Here are a couple of examples of recent revocations of those foreign universities:


http://gazette.gc.ca/rp-pr/p1/2016/2016-01-30/html/commis-eng.php

CANADA REVENUE AGENCY
INCOME TAX ACT
Revocation of registration of qualified donees

The following notice of proposed revocation was sent to the qualified donees listed below revoking them for failure to meet the part of the Income Tax Act as listed in this notice:

“Notice is hereby given, pursuant to paragraph 168(1)(b) of the Income Tax Act, that I propose to revoke the registration of the organizations listed below and that the revocation of registration is effective on the date of publication of this notice.”

Name/Address

BETHEL COLLEGE, MISHAWAKA, IND., U.S.A

BETHEL COLLEGE, NORTH NEWTON, KANS., U.S.A

CATHY HAWARA
Director General
Charities Directorate

http://www.gazette.gc.ca/rp-pr/p1/2015/2015-12-19/html/commis-eng.php

CANADA REVENUE AGENCY

INCOME TAX ACT

Revocation of registration of qualified donees

The following notice of proposed revocation was sent to the qualified donees listed below revoking them for failure to meet the part of the Income Tax Act as listed in this notice:

“Notice is hereby given, pursuant to paragraph 168(1)(b) of the Income Tax Act, that I propose to revoke the registration of the organizations listed below and that the revocation of registration is effective on the date of publication of this notice.”

Name/Address

AUGSBURG COLLEGE, MINNEAPOLIS, MINN., U.S.A.

BELOIT COLLEGE, BELOIT, WISC., U.S.A.

BENNINGTON COLLEGE, BENNINGTON, VT, U.S.A.

BETHEL UNIVERSITY (FORMERLY BETHEL COLLEGE AND SEMINARY), ST. PAUL, MINN., U.S.A.

BOSTON COLLEGE, CHESTNUT HILL, MASS., U.S.A.

CATHY HAWARA
Director General
Charities Directorate

We have assisted foreign universities obtain the prescribed university status and also helped foreign universities with either establishing Canadian affiliates (both non-profit and registered charity) and assisted with issues relating to the provision of "official donation receipts" under the Income Tax Act. (see our Receipting Kit 2017 for examples of issues with receipting and further information).  Some foreign universities are receiving tens of millions of dollars per year through this very generous mechanism and they should make sure that they comply with the necessary requirements - losing the status can undermine their ability to fundraise in Canada and to support valuable programs of those universities.   

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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