As a condition of charitable registration, charities are required to keep proper books and records. This requirement not only enables the Canada Revenue Agency (“CRA”) to audit charities efficiently, but it also ensures that charities are able to justify and validate the information provided on their T3010, Registered Charity Information Returns. One of the most common issues of non–compliance for registered charities is failure to keep adequate books and records.
Books and records include a corporation’s governing documents as well as its source documents. Governing documents are those documents that give a corporation its legal existence (e.g., articles of incorporation, articles of amendment, letters patent, and supplementary letters patent). Source documents, on the other hand, are those documents that support the information contained in the corporation’s books and records (e.g., invoices, vouchers, contracts and bank deposit slips). Charities must hold on to their governing documents for a period of … Continue reading “CRA revises position on the retention of church envelopes”
Court confirms that religious charities must actively promote a religion
Earlier this month, the Federal Court of Appeal was asked to consider whether the Minister of National Revenue had erred in confirming the decision of the Canada Revenue Agency (CRA) to deny the Humanics Institute’s application for charitable status. CRA denied the application on the basis that: 1) The Humanics Institute’s purposes were too broad; 2) the activities stated in support of its purposes were not charitable; and 3) it did not demonstrate that it would have direction and control over certain of its resources, as its proposed funding of a foreign scholarship could not be considered to be the organization’s “own activities” or the funding of a qualified donee.