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Canadian Charity Law List

December 2020

FEATURED

CRA reminds charities of importance of filing T3010 Registered Charity Information Return by December 31, 2020

CRA is reminding charities to file their T3010 if it was due between March 18, 2020 and December 31, 2020.

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Blumbergs' Canadian Charity Law Boot Camp 2021

We will be having our Blumbergs’ Charity Law Boot Camp on April 21, 2021.   It is a one-day workshop that deals with questions for those considering establishing a social enterprise, non-profit or charity. There is an early bird special if you register soon.

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Report "Unfunded: Black Communities Overlooked by Canadian Philanthropy" released - shows miniscule funding of Black groups

A recent report entitled “Unfunded: Black Communities Overlooked by Canadian Philanthropy” is a wakeup call that Foundations and Charities are not doing enough to fund Black led organizations and groups that work primarily on Black communities.  Their recommendation is to create a “The Foundation for Black Communities”. This makes a lot of sense. We don’t have an organization in Canada with the prominence of the US NAACP or United Negro College Fund. If the funds are primarily going to come from government and/or large corporations this foundation should probably be a non-profit, not a registered charity, and it would have more flexibility to work with any group in Canada.

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CRA revokes as a result of audit first 2 charities in over a year

The CRA has revoked its first two registered charities in over a year.  Actually, over 13 months not one charity has been revoked. Some think that if the CRA is not revoking any charities that is a good news story. But almost anyone in the charity sector knows that with 86,000 charities there are a few bad apples in the bunch.  These few bad apples cause immeasurable harm to the sector and the beneficiaries that depend on charities. So, forget the notion spread by some that the Charities Directorate is out to get Canadian charities and revoke them. Some may even think that the CRA has black helicopters on standby. If that was the case CRA is performing really badly. Two charities revoked as a result of audit in over a year!

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Mark Blumberg's testimony to the Standing Committee on Access to Information, Privacy and Ethics (ETHI) on CSSG/WE Charity Scandal

On Friday, December 11, 2020 I gave testimony to the Standing Committee on Access to Information, Privacy and Ethics (ETHI) on the CSSG and We Charity scandal.   Here is the video of the testimony. The part dealing with procurements and the WE Charity scandal is at 14:07, I present at 14:13:30.  Lots of great questions. There is also some heated exchanges later on whether a public inquiry is necessary, whether there are other charities who could have done the project and whether WE Charity would have received $543 million. In fairness to Nathaniel Erskine-Smith who was asking some of the questions, he admitted that the WE Charity scandal was a mistake, which is a lot more than some Liberal supporters.

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Why does CRA ask about charitable "activities" and not just about charitable "purposes"

In a recent CRA document, we obtained that was released through access to information, it provides a good explanation of why CRA cares about charitable purposes and ALSO charitable activities. For most people the point is obvious. If you are going to set up a religious charity for example and have a charitable purpose, but your activities are going to be extremely harmful to the public, people would expect CRA to reject the charity application.

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Statistics Canada launches crowd sourced questionnaire on diversity in the non-profit and charity sector

Statistics Canada launched a crowd-sourced questionnaire on diversity in the non-profit and charity sector. I encourage groups to complete the questionnaire so that we have some more information on diversity within non-profits and charities. It is available until December 23, 2020. So, if you want to complete the questionnaire you need to do it today.

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Another version of CRA's guidance on advancement of religion released in an access to information request

We have been blogging about CRA’s draft guidance “Advancement of religion and charitable registration” in 20092017 and 2018.   Essentially CRA has been working on the document for a long time and their first draft was put out 11 years ago.   We recently ran across another more recent version of the guidance and have uploaded it below.

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CRA Ministerial Welcome Package - excerpts dealing with charities

We recently received a copy of the CRA Ministerial Welcome Package which is dated November 2019.

There are a number of references to charities including on pages 39, 64, 65, 73, 87-88, 95 and 120. There is no reference in the 256-page package to non-profits!

The CRA’s budget for charities is $37.4 million or 0.8% of the total CRA budget.

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CRA introduces simplified process for employees claiming expenses while working from home

The CRA recently introduced a simplified process to allow employees in certain cases to claim home office expenses. About 1/2 of charities in Canada have employees so this will be helpful for them. Also, many volunteers have day jobs and will benefit from this. In short, this simplified procedure will only apply to employees that worked from home at least 50% of the time over a period of 4 consecutive weeks in 2020, it is capped at $400 maximum and it provides $2 deduction for each day the employee worked from home. There is still available the “detailed” method which may be better for some employees where the employer signs a form.

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CRA updates and releases new charity guidances

On November 27, CRA put out 2 new Guidances (we discuss later in the newsletter)

Also, they put out an updated CG-027, Public policy dialogue and development activities by charities

As well CRA updated two guidance dealing with intermediaries, in Canada and outside of Canada.

 

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CRA document "Purposes Not Being Furthered" dealing with charity applications without adequate information on activities

About 4000 groups apply each year to the Charities Directorate of CRA to receive registered charitable status and about 46% obtain that status. The groups who don’t get charity status are not necessarily in any way bad groups – but there is an issue or issues that preclude CRA from registering them as registered charities. About 2 years ago we published an article Top 68 CRA Reasons for Denying your Canadian Registered Charity Application.

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Updated T3010 Form

Earlier this month, CRA update the T3010 form found here. With the CRA’s COVID-19 extension for the T3010 Annual Return, many charities must file their T3010 by December 31, 2020. This deadline is fast approaching and many charities may have already started filling out the form. We recommend that all charities ensure that they not only get the T3010 form in on time, but also that they ensure they are using the correct T3010 form.

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Blumbergs Canadian Charity Sector Snapshot 2018

Here is our Blumbergs Canadian Charity Sector Snapshot 2018.

We recently reviewed the T3010 Registered Charity Information Return database for 2018 as part of the Sean Blumberg Transparency Project.  The database covers about 84,323 of the 85,800 registered charities in Canada that had filed their T3010 and were processed into CRA’s Charity Listing database by May 2020

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Capacity building, education, and online courses for the Canadian charity and non-profit sector

Our firm has been using online tools for over 10 years – primarily webinars.  In 2018, we moved to providing paid online courses dealing with charity and non-profit legal compliance and risk management to the non-profit and charity sector as well as professional advisors.  We have 520 students who have signed up for our courses over the last two years.  They range from 1 hour to 7 hours in length.   We now have 19 different courses ranging from $75 to $399.  We also have bundles and group discounts.

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Blumbergs Online Courses

We have created some online courses on various charity law issues. These courses are meant to be easier to access, more convenient and available 24/7 exactly when needed. You can do an online course at your pace and redo sections if you wish.

We have courses on the following subjects:

  • Top 20 Charity Law Issues for Canadian Registered Charities
  • Donor Advised Funds (DAFs) In Canada
  • Fundraising from Canada – A course for groups outside of Canada
  • Mergers of Canadian Non-Profits and Charities and Dealing with Uncertain Times
  • Ontario not-for-profit corporations under the Ontario Corporations Act and dealing with ONCA
  • Receipting for Canadian Registered Charities
  • Should We Establish a Canadian Social Enterprise, Non-Profit or Charity and How to Do It?
  • Multiple Corporate Structures for Canadian For-Profits, Non-Profits and Charities to Enhance Flexibility + Impact
  • Blumbergs’ Canadian Charity Law Boot Camp 2020
  • Canadian Charities Working with Non-Charities in Canada Course
  • Restricted Gifts – Managing the Opportunities and Dangers of Restricted Charitable Gifts
  • Foreign Activities and Canadian Charities
  • Fundamentals of Running a Canadian Charitable Organization/Operating Charity
  • Fundamentals of Running a Private or Public Foundation in Canada
  • Transparency in the Canadian Charitable Sector and the T3010 Registered Charity Information Return
  • Membership of Non-Profits and Charities in Canada
  • So now you are a registered charity – What is next
  • Blumbergs’ Canadian Charity Law Institute 2020
  • Finance Bundle

We have created various price points depending on the needs of the organization.  We also will create bulk discount codes when courses are needed across a whole organization.

We are also doing customized courses for different organizations depending on their needs. Some are focussed on boards of directors while others are focused on staff.  Let us know if your organization needs a customized or live online course.

 

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CRA

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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CRA's New Education Guidance - CG-030, Advancement of education and charitable registration

CRA issued a few new guidances on Friday (November 27), including a guidance on the advancement of education: CG-030, Advancement of education and charitable registration. This is a welcome new guidance that explains what CRA expects from a charity or an entity applying for charitable status under the “advancement of education” head of charity. This new guidance replaces previous CRA commentary, including the commentary on advancement of education and scholarships. The policy statement on Research as a charitable activity is still in force and separate.

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CRA's New Guidance - CG-029, Relief of Poverty and Charitable Registration

Friday (November 27), 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.

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CRA releases foreign activity guidance after multi-year delays as well as guidance on intermediaries working in Canada

CRA released on Friday (November 27) the updated guidance CG-002, Canadian registered charities carrying on activities outside Canada. Essentially, this guidance deals with Canadian charities conducting foreign activities. About 5000 Canadian registered charities conduct foreign activities every year. Over the next 10 years up to $80 billion, much of it highly tax-subsidized funds, will be sent by Canadian charities to work abroad and we need to have a vigorous system for ensuring that funds are used appropriately.

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Corporate Requirements and Changes

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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Ontario government has extended ability for OCA corporations to have virtual meetings until May 31, 2021

The Ontario government has recently extended the ability for Ontario Corporations Act (OCA) corporations to have virtual meetings until May 31, 2021. It is contained in O. Reg. 544/20: EXTENSION OF TEMPORARY SUSPENSION PERIOD. This will be useful for some Ontario corporations that have governing documents that don’t allow for virtual meetings as they will be able to have virtual meetings despite the governing documents until May 31, 2021. Any corporation with such restrictions should consider revising their governing documents to allow for virtual meetings. Alternatively consider moving out of the antiquated Ontario system to the Federal CNCA.

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Upcoming Events and Programs:

Blumbergs’ Canadian Charity Law Boot Camp 2021 – online

Blumbergs’ 19 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