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CA Community Ambassadors

Incorporating and Registering a Charity May 2014 Part 1: the difference between a registered charity and non-profit organization. CA Community Ambassadors. Disclaimer:

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CA Community Ambassadors

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  1. Incorporating and Registering a Charity May 2014Part 1: the difference between a registered charity and non-profit organization CA Community Ambassadors Disclaimer: The contents of this presentation are provided as general information only. It is not legal advice. If you have a legal problem, you should consult a lawyer. Your use of this information in this presentation is your responsibility and is at your own risk. This information is provided ‘as is’, without warranty of any kind. The information in this presentation was correct at the time it was printed. Be aware that there may have been subsequent changes which make the information outdated.

  2. Our goal • To explain the requirements for a Canadian Registered Charity as mandated and regulated by the Canadian Revenue Agency. • To explain the process of incorporating and registering a charity • To provide resources to support non-profit organizations

  3. CA Community Ambassadors • The mission of the Community Ambassador Committee is to connect Alberta CA’s with not-for-profit organizations to offer financial expertise, leadership and guidance using the CA skill set.

  4. Presentation overview:

  5. Part 1 the difference between a registered charity and non-profit organization

  6. Definitions: Primary Differences • Registered charities are often referred to as Not-for-Profit Organizations. However, while both types of organizations operate on a Not-for-Profit basis, the two types are defined differently under the Income Tax Act. • Registered charities must be established and operate exclusively for charitable purposes, and an entity must apply to the Canada Revenue Agency (CRA) to be approved as a charity. • Not-for-Profit Organizations (NPO’s) can operate for social welfare, civic improvement, pleasure, sport, recreation or any other purpose except profit. NPO’s are not required to register with the CRA and are not issued a registration number. NPO’s cannot issue official donation tax receipts, and are generally (but not always) exempt from paying tax. Definitions| Requirements | Incorporating | Registering as a Charity | Compliance | Resources

  7. Definitions: Primary Differences • The primary differences between a non-profit organization and a registered charity is the following: • Tax receipts can be issued by a registered charity • A registered charity must be approved by Canadian Revenue Agency • Spending requirements must be met by a registered charity Definitions| Requirements | Incorporating | Registering as a Charity | Compliance | Resources

  8. Definitions: Summary Definitions| Requirements | Incorporating | Registering as a Charity | Compliance | Resources

  9. Should our organization become a registered charity: The pros and cons • Pros • Official donation receipts can be issued which allows for individuals to claim donations as a tax deduction. • This results in increased fundraising opportunities • Receives a designation by the CRA as charitable organization • Allows for stronger recognition by stakeholders • Cons • Must apply to the CRA and be approved for registration as a charity. This process can be time consuming • Must spend a minimum amount on its own charitable activities Definitions| Requirements | Incorporating | Registering as a Charity | Compliance | Resources

  10. Resources • Thinking of Becoming a Registered Charity • Charity Central • Applying for Registration • CRA • Canada Not-for-profit Corporations Act (CNCA) Suitcase • Mark Blumberg Definitions| Requirements | Incorporating | Registering as a Charity | Compliance | Resources

  11. The end of Part 1. Definitions| Requirements | Incorporating | Registering as a Charity | Compliance | Resources

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