Last month we shared part one of this series about how the Canada Revenue Agency’s (CRA) Charities Directorate’s website is a valuable resource for the over 85,000 registered charities in Canada and is probably not used as much as it could be by charities and their advisors. The website provides detailed information on starting up, operating and winding down a charity and has many other useful features.  We use the CRA website on an almost daily basis.  Apparently, there were approximately 2.3 million visits to the CRA’s website last year so obviously others are using it as well.  

In this second of our two part series here are more ways that the Charities Directorate website can help your charity.

8.     Compliance and Audits

The Compliance and Audits section of the website provides information on the Charities Directorate’s compliance and audit programs.

Charities should proactively review and monitor their activities to ensure they are operating within the appropriate boundaries. The most common non-compliance issues noted by CRA include lending registration numbers, inadequate books and records, inflated receipt amounts, receipts with inaccurate or missing information and abusive tax shelter gifting arrangements.

The website also contains information on the audit process. For many charities the audit process can be a stressful time, with many fearing that their charitable registration will be revoked. However, the outcomes of an audit can be education letters, compliance agreements, sanctions, or revocation, with revocation being a last resort.

9. Revoking Registered Status

Should your charity decide to voluntary give up its charitable registration or should it be revoked by the Charities Directorate, your charity has certain obligations that it must meet as part of the revocation process.

The Charities Directorate website explains the types of revocations, processes and consequences of revocation. It also explains the  Form T2046, Tax Return Where Registration of a Charity is Revoked that is required to be filed by the charity and the calculation of the revocation tax that may apply to a revoked charity.

If your charity has its charitable registration revoked, you may have several options available, including re-registering or filing an objection or appeal.

10.  T3010 Registered Charity Information Return

The T3010 needs to be filed with CRA each year, within 6 months of the end of a charity’s fiscal year.  It is a very important document and there are many resources on the CRA website to help charities complete the Return including:

• Amending the T3010 information return
• Avoiding common mistakes
• Checklist
• Completing Form T3010 (13), Registered charity information return (recorded webinar)
• Completing the Registered charity information return T3010-1 (recorded webinar)
• Consequences of non-filing
• Disbursement quota checklist
• Filing notices
• Filing the information return
• Financial statements
• Guide T4033, Completing the Registered Charity Information Return
• Information available to the public
• List of companies authorized to produce customized T3010 returns
• Program areas and field codes
• Registered Charity Basic Information sheet (TF725)
• Registered Charity Information Return Summary

 11. Changes with your charity

The Charities Directorate provides helpful information about various changes that charities may have to make:

• Amalgamations, mergers, and consolidations
• Changing address, phone number, and contact person
• Changing activities
• Changing authorized representative
• Changing bylaws
• Changing director, trustee, or like official
• Changing legal name
• Changing legal status
• Changing purposes (objects)

12. Contact information

The Charities Directorate has several departments so it is important to know where to send your documents to. Charity applications are handled by a different department than requests from existing charities. You can find the Charities Directorate contact information here.

The Charities Directorate is also available to answer basic questions you may have including:

• provide general information to the public about registered charities;
• confirm whether an organization is a registered charity;
• handle requests for public documents such as a registered charity's annual information return and financial statements;
• provide information to applicants on how to apply for registration and how to complete the application (Form T2050);
• provide information to registered charities on how to issue official donation receipts and how to complete the annual information return (Form T3010); and
• provide guidance to registered charities on changing their legal name, purposes, activities, and more.

While the Charities Directorate provides several resources to assist charities with gaining an understanding of their legal requirements, for more complicated issues, you may wish to seek legal advice.

13. What’s New

The What’s New Section has some recent news from the Charities Directorate.   It is a good place to check out recent developments.

14. Newsletters

CRA has old historic newsletters that can sometimes contain valuable information on different issues.

15. Donors

Donors often worry about charities.  The Charities Directorate has a whole section addressed to donors and their needs.   Topics include making a donation and avoiding fraud, claiming charitable tax credits, and how to help victims of a disaster.

There are lots of other interesting resources on the CRA website.  Check it out when you have a chance.

Mark Blumberg and Yi-Mei Ting are lawyers at Blumberg Segal LLP in Toronto, Ontario.  To find out more about legal services that Blumbergs provides to Canadian charities and non-profits please visit www.blumbergs.ca, www.canadiancharitylaw.ca  or www.globalphilanthropy.ca

This article is for information purposes only. It is not intended to be legal advice. You should not act or abstain from acting based upon such information without first consulting a legal professional.