Tax and Charity Lawyers for Charities, Not for Profits, and Individuals in Canada
Tax & Charity Law
» Contact Us
Newsletter

Sign up for our free Charity Law Newsletter.
» Signup Here Now

» View our Newsletter Archive

Tax Tips

Even a charity operating in good faith, may inadvertently provide donors with a receipt that is deficient in some way. In such an instance, the charity is liable to a penalty to the charity of 5% on the eligible amount stated on the receipt for a first offence and 10% for a second offence. However, the greater penalty is perhaps to the charity s reputation when the CRA disallows a donor s official tax receipt. Therefore, it is important that the charity not make any errors on the receipts that it issues and that it only issue receipts for properly made donations.

Planning to visit Alberta and ask for money?
By: Yvonne Chenier


There are many reasons to visit Alberta.  Families might take their Canadian winter vacation to ski on Canada's Rocky Mountains and take in the breathtaking views.  Charitable organizations, looking for funds for their projects, may want to visit to tap in to some of that famous oil money.

Although families who come to Alberta do not need to do more than outfit themselves in the latest ski and après ski wear, any organization trying to raise funds in this resource rich province is well advised to check out two legal requirements before making any travel plans.  After all, no one in any organization wants to be embarrassed by doing something wrong while they are trying to do something good.

First, an organization must be registered to operate in Alberta. Even though home grown not for profit organizations that are founded in Alberta have a few easy options to select from if they want to start operating, an organization that already legally exists elsewhere has only one option when they want to carry on their good work in Alberta.  Just like a commercial venture that wishes to be licensed or registered to carry on business in Alberta, a not for profit organization coming from another jurisdiction  has to apply  and register under the Alberta Business Corporations Act before it can technically and legally carry on  business.  This is so even if the business is for benevolent purposes.   Furthermore, there is an additional headache for many out of province organizations in that they have to have a legal element as part of their organization name, in the form of an Inc., Ltd. or other similar and acceptable word.  In other words,  if ABC Charity wants to pursue its mission in Alberta it will have to adopt a name such as ABC Charity Inc. , just for the purpose of having a presence within the four corners of the Province of Alberta.  Although in the past, it seems like some charities have managed to slip into Alberta without complying with this requirement, it is very difficult, if not impossible, to do this today, according to the folks at Corporate Registry in Edmonton who enforce this requirement.

Secondly, if an organization intends to raise more than $25,000 (other than from members or their families) in Alberta during a financial year or use the services of a fund-raising business, the organization must apply for registration under the Alberta Charitable Fund-raising Act.   This must be renewed every year that the organization plans to raise such funds. This legislation applies even if an entity is already registered elsewhere (such as under the Income Tax Act of Canada) as a charitable organization.   The application process is quite involved.  Scripts and brochures that will be used for fund-raising purposes must be provided.  It is prudent to warn the principals, directors and managers of the organization that they will be subject to a background criminal check by the Government of Alberta.  The results of this check might affect the ability of the organization to be registered to fund-raise.  When an organization has been granted registration there are very specific record keeping requirements and standards of practice that must be followed.  It may be quite the administrative headache but hopefully the effort will pay off and the donations, like the oil, will start flowing.

Alberta encourages visitors, both those who come for the fun and those who come for the fund-raising.  There is no hassle for the fun seekers but the fund-raisers need to jump through a few hoops before they can be rewarded.