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Canadian Charity Law List

August 2020

FEATURED

Blumbergs’ Canadian Charity Law Institute 2020 - online

Every year Blumbergs has its Blumbergs’ Canadian Charity Law Institute.  This year we will be doing a “mini-institute” – very virtual, much shorter and more affordable but covering a number of topics that are of concern to Canadian charities.  The amount of change over the last few months has been staggering. So please join us on Wednesday, October 21, 2020, for the 9th Blumbergs’ Canadian Charity Law Insititute.  Registration and introductions will begin at 12:30 EST and the Institute will run until 4PM EST. There is an early bird special available at the moment.

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We just launched a new course - Membership of Non-Profits and Charities in Canada

There is so much confusion on memberships for Non-Profits and Charities in Canada that we have just launched a 2-hour course on the topic.

Here is more information.

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CRA Question and Answer Teleconference on the Canada Emergency Wage Subsidy (CEWS)

Here is information from CRA on their upcoming teleconference on the Canada Emergency Wage Subsidy (CEWS).

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Corporations Canada extends AGMs for Canada Not-for-profit Corporations Act (“CNCA”) corporations till Dec 31, 2020

In what is very good news for many non-profits and registered charities in Canada, Corporations Canada has extended the deadline for AGMs for Canada Not-for-profit Corporations Act (“CNCA”) corporations till Dec 31, 2020.  This helps these organizations in that they don’t have to now request an extension.  Also it applies to both presenting financial statements and AGMs.  It is retroactive to March 13, 2020.

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CRA asking about cryptocurrencies on charity audits

When CRA audits charities they typically send a long questionnaire to be filled in by the charity on many different issues.  With some questionnaires, it is clear that they have a particular interest in a certain area such as foreign activities, but mostly these questionnaires are general.

I noticed in a general questionnaire that CRA is now asking about cryptocurrency donations.  Here are some of the questions.

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Gospel for Asia, Bankruptcy Protection, and a Multi-Million Dollar Class Action

Recently, the CBC published an article entitled Charity Gospel for Asia files for creditor protection after $170M lawsuit.  It is interesting that people have not heard of Gospel for Asia including those who have worked in the international development sector for decades.  The reason that it is interesting is that Gospel for Asia was one of the largest charities in Canada sending money abroad.  For example, in 2016 they allegedly sent over $16 million abroad. Here is a 2016 article that we wrote.  On the CRA Charities Listing they go by GFA World.  Here is their information on CharityData.ca.

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"Steve Bannon Is Charged With Fraud in We Build the Wall Campaign" - some quick thoughts on fundraising and restricted gifts

In this New York Times article published on August 20 entitled “Steve Bannon Is Charged With Fraud in We Build the Wall Campaign” it has shocking revelations about a fundraising campaign in the US.  Hat tip to Paul Alof for retweeting it.

The NYT notes “Stephen K. Bannon, President Trump’s former top adviser, was charged on Thursday in New York with defrauding donors to We Build the Wall, an online fund-raising effort that collected more than $25 million for the president’s signature plan to erect a barrier on the Mexican border.”

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If your CNCA directors change - you need to let Corporations Canada know in a timely way!

With the current focus on WE Charity and the CSSG program, there is a lot that can be learned about transparency in the charity sector.   I will now discuss directors’ changes and the importance of notifying Corporations Canada if you are Canada Not-for-profit Corporations Act (“CNCA”) corporation.

CNCA corporations are required to report any changes regarding directors by filing a Form 4006 within 15 days of the change or, in the case of a change to a director’s address, within 15 days of being notified of the change.  This is a legal requirement and not every charity meets that requirement but it is still a legal requirement.

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WE Charity files Federal lobbyist registration forms

On August 13, Dalal Al-Waheidi, Executive Director of WE Charity, told the Finance Committee that that day they filed their registration for the Federal lobbyist registration system.  Here is a printout WE Charity _ Dalal Al-Waheidi, Executive Director – 12-Month Lobbying Summary – Lobbyists Registration System – Office of the Commissioner of Lobbying of Canada. Here is more detailed information on the filings of WE Charity with – Communications Reports _Combined.  The filings go back to meetings in January 2019.

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Charities should pay attention to the Lobbying Act if you "lobby" the Federal government for funds

Would you like to obtain a grant from the Federal government?  Well if you “communicate with a public officer holder” asking for funds that probably is lobbying and if you spend over 1/5 of an FTE over any month (A “significant part of duties” (“The 20% rule”)) – the equivalent of say 4 days in a month totalling all staff time on the lobbying then your charity should register.  Another way of looking at it is if your charity spends about 40 hours or more in a month then it will probably have to register.

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Some recent Finance Committee meetings on WE Charity and the CSSG

The Finance Committee has had a number of meetings to inquire into the CSSG and WE Charity.  You can watch the testimony live or a recording of it.  A few days after the meeting the PDF of the transcript is available online.

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We have recently added two new online courses for Canadian charities

We have recently added 2 new full-day courses namely Fundamentals of Running a Canadian Charitable Organization/Operating Charity and Fundamentals of Running a Private or Public Foundation in Canada. These are in-depth courses which will help those who run operating charities and foundations in Canada understand the regulatory and compliance issues that they have to deal with.  We also have many other online courses that are available

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CRA Canada Emergency Wage Subsidy (CEWS) Application Guide

Here is an application from CRA relating to the Canada Emergency Wage Subsidy (CEWS).

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Lengthy FAQ from CRA on wage subsidy

Here is an FAQ released by CRA on the Federal wage subsidy.

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Some compliance trends or task over the next 6 months for Canadian registered charities

Here are a number of trends or compliance suggestions for charities over the next six months.

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Blumbergs' COVID-19 FAQs for Registered Charities and Non-profits

We will have updated our COVID-19 FAQs section on our CanadianCharityLaw.ca website. The FAQ section will deal with common issues affecting Canadian registered charities and non-profit corporations during the COVID-19 pandemic.

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New Course on Canadian Charities Working with Non-Charities in Canada

We have just prepared a new course on Canadian Charities Working with Non-Charities in Canada. Here is information on the new course and how to register.

There has been a lot of misinformation around the ability of Canadian charities to work with non-charities in Canada during the COVID-19 crisis. This course explains the rules for working with non-charities, even in times of crisis such as these.

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New course on restricted gifts in Canada by Mark Blumberg

We recently launched a new course on restricted gifts for Canadian charities: “Restricted Gifts – Managing the Opportunities and Dangers of Restricted Charitable Gifts“.  For every course, I need to have a picture and for this one, I picked a horse. Why a horse you might ask? Is it because one of my staff loves horses. Perhaps. But truthfully it is because there are two different extremes when it comes to thinking about a gift to a charity. One can be summarized as “don’t look a gift horse in the mouth” – the donor is wonderfully generous, whatever they want we should give them, we should not ask too many questions and we should not seem in any way to be ungrateful. On the other hand, is the image of the trojan horse – literally a donor through a “generous” gift causing tremendous problems for a charity. Whether it is because the donor has a sketchy reputation, the donor is a very controlling personality and wants to continue controlling the funds or the donor has very specific ideas about how the funds should be spent which are at odds with those within the charity or may even seem like a great idea today but in a year or two perhaps not so much. In the age of COVID-19 we see how tens of billions of dollars are inaccessible to help – often because of poorly thought through restricted gifts.

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CharityData.ca has been updated - check it out! More information on Canadian registered charities

We do regular updates of the portal CharityData.ca. Recently we just added more T3010 data including updated partial 2019 data and all of 2018 data.  We are now using 2018 data for searches and there are about 84,000 charities on the system.  So when you search the site, it is using as the base year charities listed in 2018.  The 2019 partial data reflects about 31,000 charities that were available in March 2020 before the CRA Charities Directorate had to shut down due to the COVID-19 pandemic.

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CRA

CRA Charities Directorate announces extension of T3010 filing deadlines until December 31, 2020 in response to COVID-19

The CRA announced on March 20 that registered charities filing deadline for the T3010 that were or will be due from March 18, 2020, till December 31, 2020, will only be due on December 31, 2020. This will be a welcome relief for many registered charities in Canada. As well, this will be a relief to many accountants who need to do audits of charities that would have to be completed prior to the completion of the financial statements and filing of the T3010. This will reduce some of the stress on registered charities who may not even have access to their offices because they are working from home etc.

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Charities Directorate Business Resumption Plan and Audits

CRA has just published its plan for the resumption of full activities.  In this article, we discuss the resumption of the Charities Directorate as well as their audits.

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CRA notice on charity applications – yes CRA is processing charity applications

CRA has been processing charity applications during the COVID pandemic – even when they were “shut down”.   This recent CRA notice advises charities that if they have a deadline to respond to on a charity application that the deadline will be extended (makes good sense) and that charity applications will not be closed just because there is no response.  Keep in mind that this is a dual-edged sword – if you take longer to respond to CRA’s requests your charity application will also take longer.  It also discusses other aspects of the notice for charity applications.

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Further extension for T2 and T1044 filing deadlines for June, July and August 2020 filers

CRA has previously announced that the T2 Corporation Income Tax Return (the T2) and T1044 Non-Profit Organization (NPO) Information Return for non-profits and others that was due between March 18, 2020 and June 1, 2020 can be filed on June 1, 2020. Now CRA has also announced that T2s and T1044s that are due in June, July or August 2020 can be filed on September 1, 2020.

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Corporate Requirements and Changes

COVID-19 and AGMs for Federal non-profit corporations under the Canada Not-for-profit Corporations Act (“CNCA”) - UPDATED

The COVID-19 crisis is forcing some non-profit organizations and registered charities to rethink the timing and manner of conducting their annual general meeting of members (AGM).  Every organization is different, and a one-size-fits-all approach does not apply.

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COVID-19 and AGMs for Ontario non-profit corporation under the Ontario Corporations Act (“OCA”)

The COVID-19 crisis is forcing some non-profit organizations and registered charities to rethink the timing and manner of conducting their annual general meeting of members (AGM). Every organization is different, and a one-size-fits-all approach does not apply.   We are assisting organizations with numerous challenges in dealing with COVID-19 and if your organization requires assistance let us know.  As the situation is evolving on an almost daily basis, we may update this article.

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Upcoming Events and Programs:

Blumbergs’ Canadian Charity Law Institute 2020 – online

Blumbergs’ 16 online courses for charities;

Free upcoming Canadian Charity Law Association webinars.


Do you require legal advice with respect to Canadian or Ontario non-profits or charities?

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