Charitable Registration
Charities Directorate - Canada Revenue Agency (CCRA)
Why register as a charity?
Who can register as a charity?
What are charitable purposes?
What is the difference between a non-profit organization and a charity?
Can a charity carry out any political work?
How can I register as a charity?
Who should complete the application form?
Charities Directorate – Canada Revenue Agency (CRA)
Registered charities and their donors receive tax relief under the Income Tax Act. The Charities Directorate of the CCRA is responsible for registering qualifying organizations as charities, Canadian amateur athletic associations and national art service organizations. The Directorate also provides technical advice on how organizations should operate, handles public enquiries, and operates an audit and compliance program.
Copies of many of the forms, pamphlets, newsletters, etc. are available on the internet site listed below. You may also contact Client Assistance Section or your local tax services office.
Telephone Enquiries:
954-0410 for local Ottawa calls (English)
954-6215 for local Ottawa calls (Bilingual)
1-800-267-2384 for toll-free, long-distance calls (English)
1-888-892-5667 for toll-free, long-distance calls (Bilingual)
1-800-665-0354 for toll-free service for hearing impaired persons
Hours:
Monday – Friday 8:00 a.m. – 5:00 p.m.
Internet address:
http://www.cra-arc.gc.ca/tx/chrts/menu-eng.html
· List of Canadian registered charities
· Publications about charities
Street Address:
Charities Directorate
Place de Ville
Tower A
320 Queen Street, 13th Flr
Ottawa, Ontario
K1A 0L5
Mailing Address:
Charities Directorate
Canada Revenue Agency
Ottawa, Ontario
K1A 0L5
The organization can issue official donation receipts for gifts received. This reduces the individual donor’s income tax payable, and reduces the taxable income of a corporate donor.
Some foundations will only fund an organization if it is a registered charity.
The organization may qualify for a GST rebate. For more information on GST accounts or rebates, please contact your nearest Tax Services Office or use the toll-free number for GST enquiries 1-800-959-5525.
Once the organization is registered, it is exempt from paying income tax (under Part I of the Income Tax Act).
Who can register as a charity?
To qualify for registration, an organization must be established and operated for charitable purposes, and it must devote its resources to charitable activities. The charity must be resident in Canada, and cannot use its income to benefit its members.
A charity also has to meet a public benefit test. To qualify under this test, an organization must show that:
its activities and purposes provide a tangible benefit to the public;,
those people who are eligible for benefits are either the public as a whole, or a significant section of it, in that they are not a restricted group or one where members share a private connection, such as social clubs or professional associations with specific membership; and
its activities must be legal and comply with public policy;
the charity’s activities must be legal and must not be contrary to public policy.
The courts have identified four general categories of charitable purposes. For an organization to be registered, its purposes have to fall within one or more of the following categories:
- the relief of poverty;
- the advancement of education;
- the advancement of religion, or
- certain other purposes that benefit the community in a way the courts have said are charitable.
- charitable organization;
- public foundation; or a
- private foundation.
The designation of a charity depends on its structure, its source of funding, and the way it operates.
For more detailed information on the requirements and obligations of a registered charity, please see the publication T4063 “Registering a Charity for Income Tax Purposes”
What is the difference between a non-profit organization and a charity?
If an organization cannot meet the requirements for becoming a registered charity it may qualify as a non-profit organization under the Income Tax Act. An organization with non-profit status does not have to pay tax on most types of income, but it cannot issue official receipts for income tax purposes.
For more information on non-profit status, contact the Client Services of your local Canada Revenue Agency’s tax services office.
Can a charity carry out any political work?
To qualify as a charity, none of the purposes or goals of an organization can be political. An organization will be excluded or disqualified as a charity whether these purposes are stated in its governing documents, or are actually pursued in its work.
- Political purposes include:
- furthering the aims of a political party;
- promoting a political ideology;
- persuading the public to adopt a particular view on a social issue; and
- attempting to bring about or oppose changes in the law or government policy.
A charity must file an annual report on its work to the Canada Revenue Agency (CRA). Information concerning the expenditures of a charity on political activities must be reported. Most organizations that lose their charitable status do so because they have violated the requirements regarding political activities.
Application forms and Guides needed to apply:
· Form T2050 “Application to Register a Charity Under the Income Tax Act”; and
· Guide T4063 “Registering a Charity for Income Tax Purposes”.
Access these forms on the CRA website.
Who should complete the application form?
A person holding a responsible position in the organization (e.g., the chairperson, treasurer, or manager); or
Someone appointed by the organization to act on its behalf (e.g., a legal representative).
For complete information about the registration process, including step-by-step instructions on filling out the Application Form T2050, please refer to the Guide T4063.
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Copyright 2003 Community Services Council Newfoundland and Labrador
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