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FEATUREDBlumbergs' Canadian Charity Law Boot Camp 2021We 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. Only a few more weeks to register for this annual event. Blumberg Segal LLP is looking for an Associate Lawyer to join our Charity and Non-Profit practiceWe are seeking an associate lawyer to join our firm. Our ideal candidate is diligent, detail-oriented, motivated and has an interest in the non-profit and charity sector. Here is information on the position and how to apply. Blumbergs’ Snapshot of the Nova Scotia Charity Sector 2018 - providing data on the size and scope of the Nova Scotia charity sectorThis Blumbergs’ Snapshot of the Charity Sector in Nova Scotia 2018 provides a snapshot of the registered charity sector in Nova Scotia taken from a subset of the 2018 T3010 filings. How has COVID affected funding of the Canadian charity sector? Part 1On March 23, I tweeted about a US study on the effect on COVID on donations. The study noted that US charitable giving increased by 10.6 percent in 2020. It is based on “sample data from nearly twenty-five hundred nonprofits in AFP’s Growth in Giving Database”. Sample data from 2500 of 1.5 million charities is a very small sample size. Now here is our preliminary study on the Canadian charity sector. Upcoming Webinars for the Canadian Charity Law AssociationThe Canadian Charity Law Association is delivering some upcoming webinars. Registration is free but space is limited. Topics are subject to change. More information on each of these webinars and how to register is provided here. The Charities Directorate of CRA announces new webinars on gifting and receipting on March 30 and March 31Here is an announcement from CRA relating to new webinars dealing with gifting and receipting on March 30 and March 31, 2021. Statistics Canada report on charitable donors in 2019Stats Can recently released their Charitable Donors, 2019 report. I have been critical of StatsCan in the past for their annual reports on charitable donations. My concerns have been around equating claiming something on a tax return with being “generous” and also that in some years the amounts of abusive charity gifting tax schemes were huge (e.g. $1.3 billion in 2006) and these illegitimate “donations” skewed the results tremendously. The distorting effects of these abusive schemes are much less today (and in 2019) and the numerous caveats from StatsCan are better. Funding of the charity sector is important and I am glad that Statistics Canada’s analysis and reports are better. Some interesting information on co-operatives in Canada from Statistics CanadaStatsCan recently did a short report on co-operatives which illuminates this type of entity. It also notes that about 64% of co-operatives are non-profit. It is not clear how many of these non-profits are registered charities. Here is the report. Report #1 of the Advisory Committee on the Charitable Sector - more thoughtsAfter my very disappointing first read of the “Report #1 of the Advisory Committee on the Charitable Sector” which was just released here are some further thoughts.
Trying to do grantmaking in Canada betterWell, we are in the midst of a pandemic and this has resulted in some grantmaking foundations and philanthropists increasing giving and thinking carefully about how and who they give to. Unfortunately, and we may only know for sure in a year or two, many foundations are not increasing grantmaking and they are using grantmaking ideas and techniques that go back decades. Actually, who are we trying to fool – most of what grantmakers do today have gone back thousands of years – both good and bad. Will changing structured arrangements into a reasonable person test help the charity sector? - Part 1 - The preambleRecently a bill was proposed in the Senate –BILL S-222 An Act to amend the Income Tax Act (use of resources), which will eliminate the “own activities” requirement of charities and change the rules for Canadian charities working with non-charities, both in Canada and abroad. The bill was introduced on February 8, 2021. In a series of notes, I will highlight some concerns with the bill. Will changing structured arrangements into a reasonable person test help the charity sector? - Part 2 - The Main Provisions and various general concernsRecently a bill was proposed in the Senate –BILL S-222 An Act to amend the Income Tax Act (use of resources), which will eliminate the “own activities” requirement of charities and change the rules for Canadian charities working with non-charities, both in Canada and abroad. The bill was introduced on February 8, 2020. In this brief note, I will highlight some concerns with the bill. We have already discussed yesterday our concerns with the preamble. Will changing structured arrangements into a reasonable person test help the charity sector? - Part 3 - The Reasonable Person - lots of questionsRecently a bill was proposed in the Senate –BILL S-222 An Act to amend the Income Tax Act (use of resources), which will eliminate the “own activities” requirement of charities and change the rules for Canadian charities working with non-charities, both in Canada and abroad. The bill was introduced on February 8, 2020. In this brief note, I will highlight some concerns with the bill and specifically the reasonable person test. Will changing structured arrangements into a reasonable person test help the charity sector? - Part 4 - Charitable purposes and ConclusionRecently a bill was proposed in the Senate –BILL S-222 An Act to amend the Income Tax Act (use of resources), which will eliminate the “own activities” requirement of charities and change the rules for Canadian charities working with non-charities, both in Canada and abroad. The bill was introduced on February 8, 2020. In this brief note, I will highlight some concerns with the bill. We have discussed our concerns about the “reasonable person” test here. Now let’s talk about what will be needed to ensure that the funds are spent on charitable purposes. Discussion paper from the T3010 User Group on improvements to the T3010It was very nice to read recently a discussion paper from the T3010 Research Group on how the T3010 and data in the sector can be improved. It was written by François Brouard (Sprott School of Business, Carleton University), Michael Lenczner (Ajah) and Annika Patzelt (Ajah). I thought the paper was very well written. I am not used to reading documents in the charity sector that are 23 pages long and I don’t have lots of concerns! CRA provides additional details as to changes with the T3010 over the last few yearsHere is a document in Excel that we recently received from the Charities Directorate of the CRA. It is entitled T3010 Master Public Data Dictionary – January 2021 and it discusses recent changes to the T3010. If you click the link above it should open the spreadsheet in Excel. Update on T3010 dataOn March 16, I received more data from CRA for the T3010. It has partial information for 2019 and 2020 as at February 28, 2021. For 2019, there are 79840 charities reporting. For 2020, there are 25,877. There was an extension provided because of COVID so that charities in 2020 only had to file their 2019 and 2020 returns by December 2020. This is one reason that the data from 2019 is not nearly as complete as one would expect by this time. As well some groups may not have filed their T3010 at all for 2020 or their information has not been processed yet by CRA or provided. Canada now has 2 registered journalism organizationsRecently The Narwhal News Society was added as a registered journalism organization (RJO) and therefore along with La Presse Inc. there are now two RJOs. RJOs are qualified donees and therefore can issue official donation receipts and also receive gifts from registered charities if their objects allow for it. Here is the list of RJOs on the CRA website. New course – Running and Maintaining a Federal Non-Profit Corporation under the CNCA – An IntroductionWe have recently prepared a new course on Running and Maintaining a Federal Non-Profit Corporation under the CNCA – An Introduction. New course - Separation and Independence by Canadian Charities from Entities that are not Canadian CharitiesCanadian charities can have relationships with non-charities but need to have adequate separation. We have now added a further course on “Separation and Independence by Canadian Charities from Entities that are not Canadian Charities” which discusses the importance of having adequate separation and how to monitor and achieve adequate separation. New Course – Should you agree to be a director or board member of a Canadian non-profit or registered charity?There are over 600,000 directors of Canadian charities alone. There are many more people in Canada who serve on the boards of non-profits that are not charities. Non-profits and registered charities need to have directors who are capable, caring, connected for these sectors to operate properly. This course will give you ideas of issues, questions and items to consider before agreeing to be a director or board member of a Canadian charity or non-profit. This course cannot answer the question for you of whether you should join a particular board as it is often a deeply personal and highly fact-specific decision that is sometimes easy to make and sometimes not. However, hopefully, this course will help you make a more informed decision. The course is currently available for free. Blumbergs' Pre-Budget Submission for the Federal Budget 2021 relating to charities, transparency and other issuesAs we noted previously, the Federal Government has launched pre-budget consultations for the 2021 Federal Budget. Here is the Blumbergs’ Pre-Budget Submission relating to charities, transparency and other related issues. Blumbergs Online CoursesWe 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:
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 focused on boards of directors while others are focused on staff. Let us know if your organization needs a customized or live online course.
CRA UpdatesIn 2021 T3010s will be due within 6 months of the end of a charity's fiscal year, unlike 2020In 2020 CRA gave an extension to many charities to deal with the unexpected events around COVID. In 2021, unless the situation changes drastically, there will be no extensions. The normal rules apply for filing of the T3010 for registered charities i.e. no later than 6 months after your charity’s fiscal year-end. For many charities that just filed their 2019 T3010, they soon will need to file their 2020 T3010. We have written many articles on the T3010 and the key is to start collecting information early so that you are not rushing at the end. Also, especially with complicated or large charities, it is important to have a number of people review the form to ensure it is accurate. CRA provides additional information on foreign activities by Canadian charitiesCRA has now changed the way the export data and publishes that data on the T3010 online so that with Schedule 2 dealing with foreign activities now has unlimited entries for Q2, Q3 and Q7. Before there were only a few spaces for answers and the rest were provided by a charity in a separate sheet but not included on the online T3010. Corporate UpdatesReminder from Corporations Canada re: AGMs in 2021 for CNCA corporationsHere is a reminder we just received from Corporations Canada relating to AGMs in 2021 for CNCA corporations and that they can be done virtually, partially virtually or by unanimous resolution in many cases. Also if you wish to delay the date for your CNCA AGM you will need permission from Corporations Canada. In 2020 there was an extension on deadlines for providing financials and having your AGM – one should plan on there not being a similar extension in 2021 and try to have your AGMs on time. Ontario government has extended ability for OCA corporations to have virtual meetings until May 31, 2021The 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. New Ontario Business Registry will one day become active and you should sign up now to get reminders and informationThe Ontario Ministry of Government Services is launching a new Ontario Business Registry at some point over the next year or two. This Registry will one day contain profiles on any business that is registered (including non-profit corporations), groups incorporated or licenced to carry on business in Ontario. For now, there is no registry, but you can sign up for an email list to get updates in the future about the registry. This is not your normal email list where anyone can sign up. This is only for groups to provide their “official email address”. |
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