Q&A Category | Charity FAQs

Charity FAQs

Is It Necessary for Charities & Not-for-Profits to Carry Insurance and Liability Coverage?

Insurance companies use the likelihood of a claim being filed on a policy to determine the premium amount for that policy. Even if your organization has never encountered a problem or filed a claim, the premiums you pay will be determined based on the statistical data for similar organizations......

...

How Can Charities Effectively Manage Volunteers?

Charity organizations frequently rely on volunteers to perform essential roles, and while volunteers are not employees, these organizations still have certain responsibilities toward them. To avoid potential issues, it is recommended to implement the following best practices.

...

Select Carefully: 6 Strategies for Finding Suitable Nonprofit Board Members

Have you ever heard the timeless phrase, "You are only as good as the company you keep?" Well, this saying certainly holds true for the board of directors of your charitable organization. If your board is active, diverse, and well-connected, your organization is likely to thrive. Conversely, if your

...

How Do I Determine the Fair Market Value for an In-Kind Donation Charity Receipt?

In order to issue a tax receipt for a gift, it is necessary to first determine the fair market value of the gift as well as any benefits the donor received in exchange for making the gift. If the fair market value of the gift or benefit cannot be determined, a tax receipt cannot be issued.

...

Is Outsourcing Bookkeeping for Your Charity the Right Choice?

Ensuring prompt and precise financial documentation stands as a crucial obligation for every charity organization. However, accomplishing this task accurately can be quite time-consuming, given the intricate nature of the regulations involved.

...

Determining Fair Market Value for Non-Cash Gifts to Charities

Understanding Fair Market Value (FMV) is vital for charities and donors alike. Accurate valuation of non-cash gifts and transparent reporting of advantages ensures compliance with tax regulations and fosters trust between charities and their supporters. By following established guidelines and ....

...

Should I Use a Celebrity to Promote my Charity?

Utilizing high-profile figures for charitable causes can be a double-edged sword. Numerous charitable organizations have successfully leveraged celebrity ambassadors for various purposes, such as fundraising and advocacy. These individuals can significantly elevate the visibility of a charity...

...

Can Canadian Organizations Continue to Support Indian NGOs?

There have been numerous inquiries regarding the feasibility of Canadian charities and non-profits continuing their collaborations with non-governmental organizations (NGOs) in India, given the heightened enforcement of Indian laws governing foreign charitable contributions. This post aims to shed..

...

What Do You Need to Know About the Annulment of Charitable Registration in Canada?

Explore the intricacies of charitable registration annulment in Canada—its purpose, the decision-making process by the CRA, and the significant consequences for organizations.

...

What transactions usually don't qualify as gifts in a registered charity?

Explore the nuances of gift transactions in Canada as we delve into the criteria outlined by the Canada Revenue Agency (CRA).

...

What is Split Receipting?

Explore the world of split receipting, a method utilized by charities to determine the eligible amount of a donation, factoring in benefits received by donors. Learn about the calculation process, transparency, and compliance advantages, and how educating donors on split receipting principles foster

...

Can I Issue Tax Receipts for Auction Items?

Explore the critical aspects of issuing tax receipts for auction items in this insightful blog post. Learn the guidelines for receipting items donated and purchased at charity auctions, ensuring compliance with regulations and maintaining transparency.

...

How do I identify the best marketing channels to promote my charity and fundraise?

To guide charity organizations in choosing the right marketing channels to connect with supporters.

...

What is Capital Gains Reduction and How it Relates to Your Charity

Capital gains reduction simplifies charities' allocation of funds from asset sales, allowing them to continue their impactful work.

...

What Are the Consequences of Non-Compliance for Registered Canadian Amateur Athletic Associations (RCAAA) under the Income Tax Act?

The Canada Revenue Agency (CRA) has introduced measures to ensure compliance, including an objection process for RCAAAs to appeal decisions. Compliance is crucial for RCAAAs to continue promoting amateur sports and physical activities across Canada.

...

Can Our Charity Collaborate with a Business & Still Issue Tax Receipts?

Cause-related marketing involves partnerships between charities and for-profit partners to increase sales while mutually benefiting both parties. However, challenges arise, especially regarding the rules for issuing receipts, which necessitate precise calculations of the benefits received by donors.

...

How to Report Suspected Non-Compliance by Registered Charities to the CRA in Canada

This article discusses the importance of citizens monitoring charities to ensure compliance with regulations, highlighting red flags and reporting procedures for suspected non-compliance.

...

How Can a Registered Charity Correct Mistakes on Tax Receipts?

Explore how registered charities can correct mistakes on tax receipts, including crossing out errors, using stamps for corrections, and issuing replacement receipts for lost or incorrect ones. Learn how to maintain accurate records and transparency with donors.

...

Can School Tuition Fees Paid to a Registered Charity Be Considered Charitable Donations?

Learn about the guidelines provided by the Income Tax Act and the Canada Revenue Agency (CRA) regarding charitable donations, gifts, and exceptions for religious education at parochial schools.

...

What Information Are Available to the Public When a Charity Files Their T3010 Return?

Explore the information available to the public when a charity files its T3010 return, including program account details, financial information, and information about directors and trustees.

...

Why Does the CRA Collect Directors' Personal Information for Charity Applications?

The article discusses why the government requires personal information from individuals involved in charities when applying for charity status, emphasizing privacy, transparency, and accountability.

...

What is a Charitable Benefit, and Why Does It Matter When Applying to Become a Charity?

An organization's means of providing charitable benefits should align with its purpose, provide recognizable benefits, have a socially useful impact, and make a positive difference in the world.

...

Can a University Outside Canada Become a Qualified Donee?

The Canada Revenue Agency (CRA) has specific criteria and processes that foreign educational institutions must follow to become qualified donees, allowing them to issue official donation receipts for gifts and make them eligible for tax credits on their Canadian income tax returns.

...

Are Registered Charities Allowed to Improve Leased Property?

Registered charities are allowed to make improvements to the property they lease, but they need to follow certain rules to ensure fairness.

...

Six Tips to Conducting a Charity Capital Campaign

Leading a charity capital campaign involves making time for fundraising, crafting a compelling case for support, speaking authentically from the heart, and embracing vulnerability.

...

Why are Direction and Control Important When a Charity is Working With an Intermediary?

Direction and control are vital for charities working with intermediaries to ensure donations are used effectively and transparently, aligning with the charity's mission and maximizing impact in distant communities.

...

Here Are Five Proven Tips on How You Can Keep Your Donors Engaged

Learn five practical strategies to maintain donor engagement and ensure continued support for your charitable cause.

...

Can Canadian Charities Raise Funds Through a Third Party?

Explore how Canadian charities can raise funds through third-party fundraisers and the strict rules and guidelines they must follow, including maintaining control over funds, issuing accurate receipts, and establishing clear agreements to ensure transparency and integrity in fundraising efforts.

...

Is Peer-to-Peer Fundraising the Key to Successful Charity Campaigns?

Peer-to-peer fundraising is a powerful strategy for charity campaigns, leveraging personal networks and community connections to amplify reach, build trust, and raise more funds, though it requires careful organization and support.

...

CNCA vs. ONCA: What's the Difference and How Does It Affect Charities and Not-for-Profits?

Explore CNCA vs. ONCA: Key differences and impacts on Ontario charities and not-for-profits.

...

5 Tips for Charity Cybersecurity

Protect your charity from cyber threats with these five essential cybersecurity practices, ensuring data safety and donor trust in today's digital world.

...

The Only Guide You’ll Ever Need on How To Register a Canadian Charity

Navigating all that legal mumbo jumbo that comes with charity registration is like getting pet hair all over your new black clothes. Getting a pet may be cute — or in this case — registering your charity. But no one wishes to deal with the stress that comes with it. The barrier to entry and cumberso

...

How to Register a Non-Profit in Canada

If you are hoping to register a nonprofit in Canada, chances are you already know the difference between a charity and a non profit. Maybe you’re hoping to register a professional association, or an amateur sports club, or even a child care facility for your local school. Whatever the type of organi

...

How Long Does it Take To Register a Charity in Canada?

According to the Charities Directorate, a straightforward application for Charity Registration takes 2 months. In reality, this turnaround time is seen in only about 1% of charity applications. For the vast majority of Charity applications, where the CRA (Charities Directorate) has follow up questio

...

Whats the Difference between a Charity and a Not-for-Profit?

Registered charities are charitable organizations, public or private foundations that are registered in Canada. All charities in Canada have to have a charitable purpose that falls into one or more of the following categories: The advancement of education. The relief of poverty. The advancement of r

...

The 5 Things You Need To Know Before Starting a Canadian Charity

The CRA is always ready to show its teeth to Charity Organization strutting their stuff in wanton neglect of its established order, and this hardly requires analysis. Canada boasts a legion of registered charities that’re charitable organizations. You couldn’t count them even if you tried. 86,000, t

...

8 Hot Ways to Fundraise for your Charity

Guest Article: Sandy Rees, Founder and Chief Encouragement Officer of Get Fully Funded. When you have a new Charity, you need money fast to get everything up and running. You need to pay for programs, overhead, and salaries. There are thousands of ways you can raise money, but you need something t

...

Can I Return A Donation?

We are a Canadian Charity in the poverty sector, operating out of British Columbia, Vancouver to be specific. We recently received a sizable donation from a shady individual who has proceeded to publicize his contribution to our Charity. We would like to return the donation and disassociate from him

...

Do I Receive a Tax Credit for Donations to a Canadian Municipality?

What Are Qualified Donees?A common misconception is that the term “Qualified Donee” is synonymous with the term “registered charity.” This however is inaccurate. The term Qualified Donees includes more than 4,100 organizations that are not registered charities, categorized as follows: Registered cha

...

‍How Much of a Charity's Budget Should Go to Overhead?

Overhead is the term used for expenses of a charity that are not the cost of an actual program or charitable activity. The overhead costs generally fall under the categories of administration, management, and fundraising. What Are Typical Overhead Costs for a Not-for-Profit and Charity? Some example

...

Critical Information to Include in a Charity Application

About 65% of charity applications in Canada are not approved. There are many reasons why the CRA might reject a charity application, but the primary reason is simply because the Charity applicant didn't provide enough information. At minimum, a charity application should include the following inform

...

Charity Application for Employment and Entrepreneurial Training

A charity applying to provide entrepreneurial and employment training would be approved by the CRA for charity registration, that it relieves unemployment. An organization that provides entrepreneurial training can give instruction to eligible beneficiaries on various topics, such as- preparing a bu

...

What is the Business Number for our Charity?

Your Business Number (BN) is the root of all your tax accounts (i.e. Charity (RR), HST, payroll, corporate tax). Your BN and corporate income tax number are assigned automatically by Canada Revenue Agency (CRA) when you incorporate. Upon incorporation, we will send you your Business Number with whic

...

In 2020, what constitutes a qualified donee under the Income Tax Act Canada? How many are there?

A qualified donee is an organization that can issue official donation receipts for gifts received from individuals and corporations, and may receive gifts from registered charities. These qualified donees include:- Registered charities (including national arts service organizations) [85,646]- Regist

...

What is Charity Sponsorship?

When a business donates towards the expenses of a charity's event or activity, and in exchange, the charity publicizes or endorses the business's brand, merchandise, or offerings, this is known as sponsorship.

...

Key Considerations for Employment Contracts for Charities & Non-Profit Organizations

An employer has a contractual relationship with its non-union employees, and this contract of employment can be either verbal or written, sometimes with only certain terms in writing. Charities and non-profit organizations are increasingly recognizing the benefits of having a detailed written.......

...

Is a Canadian Charity Allowed to Operate a Business?

Charitable organizations (excluding private foundations) are permitted to engage in business activities, which can serve as a significant source of income. Nonetheless, these activities are subject to specific restrictions and must comply with the regulations established by the Canada Revenue Agency

...

6 Proven Tactics for Increasing Your Recurring Donations

Undoubtedly, recurring donors form the foundation of your organization. They are not only four times more valuable than one-time donors, but they also enable you to work more efficiently and plan for the future with greater accuracy, as you can rely on a steady stream of funding to sustain you....

...

Can Social Media Contribute to the Fundraising Success of Charities in Canada?

Explore how social media has transformed fundraising in Canada, widening reach, building connections, empowering individuals for fundraising, creating event hype, providing data insights, leveraging peer influence, and engaging younger generations.

...

Why Does the Cost of ONCA Transition Vary Per Not-for-Profit?

The cost of transitioning to ONCA varies due to factors like unique structure, compliance status, changes needed, and client involvement, underscoring the need for legal counsel in cost estimation and management.

...

Why Strategic Planning is Critical to the Success of Your Charitable Work?

Strategic planning is crucial for charities, guiding them to align with their mission, set SMART goals, share responsibilities, craft action plans, and monitor progress, ultimately leading to impactful and successful endeavors.

...