This is an except from the recently published "Running a Charity: A Canadian Legal Guide by Adam Aptowitzer, LL.B
The T2050 / T1789 Form
The key to becoming registered as a charity in Canada is the Application for Registered Charity Status submission to the CRA. The technical CRA designation for this application has been the T2050 form, but the CRA has ceased accepting this form and will instead use a completely online system with the new form T1789. Fundamentally, the reason for the application process is to determine whether the applicant would qualify for registered charity status, so while the form has changed, its purpose has not. A copy of the new form T1789 is on the website www.runningacharity.ca.
The application for charitable status will be examined from every angle by the Charities Directorate of the CRA to determine whether the specific applicant organization qualifies for registered charitable status. While the questions may seem innocuous, the CRA will use the form to identify (and will take a strict view) in registering potential charities. As a result, the fact that the form will be compared against the body of charity law to determine whether the applicant will qualify means that there can be tremendous value in having an experienced charity law professional review the form, if not fill it out completely.
The Charities Directorate created a guide for use by lay people when completing the T2050 form. That guide is called the T4063 [Available at www.runningacharity.ca. ]. The new online form T1789 has guidance built into the form itself and has hyperlinks to more detailed guidance, but because of the overlap in the information requested T4063 can still be of use. The guide is an adequate explanation of the information that the Charities Directorate reviews, but it does not explain why the information is being sought so that individuals filling out the form can have some sense of the legal ramifications of their answers. With some understanding of the reason for the question, prospective charities can answer more fully and forcefully. At times, we have seen tremendous misunderstandings arise because of approaches taken by different groups in completing the form. This may happen, for example, where a group’s religious beliefs are listed in a foreign language or the religious activities, at least superficially, are not put in a religious context.
As the guides are adequate for filling out the forms, this chapter will provide context for the reasons behind the questions being asked. This will help those trying to fill out the application for charitable status on their own to provide the information that the CRA seeks in the manner that it seeks it. This will improve the prospective charity’s chances for charitable registration.
Running a Charity: A Canadian Legal Guide is by Adam Aptowitzer, LL.B. This is a revised and updated edition of the five-star rated "Starting and Maintaining a Charity in Canada." Now includes new information on directors' responsibilities as well as vital updates in other key areas.
Adam Aptowitzer is a tax lawyer with special expertise in the law as it pertains to charities, not-for-profit organizations, and other non-taxable entities in Canada. His practice involves tax litigation for private taxpayers and charities and he has represented clients at the Tax Court of Canada, the Federal Court of Appeal and the Supreme Court of Canada.
