DA logo revised

Greetings!

 

Welcome to 2011's final edition of Charity Law Insights. 

 

2011 turned out to be a year of surprises brought about mostly by the Federal budget. Regular readers will recall our discussion of (amongst other things) the new ineligible director rules, the new treatment of RCAAAs and of course the virtual elimination of the donation of flow through shares to charities.

 

The first proposed budget of 2011 was also one of the elements that led to the fall of the government in March. This in turn precipitated the death of the justly maligned Bill C-470 (although we now live in fear of its zombie like resurrection).

 

The budget also tasked Parliament with a review of the tax incentives for charitable giving, and we have just received word that these deliberations will take place by Parliament's Finance Committee beginning in mid January 2012. Given the current economic climate, and previous experience, the sector has every reason to be concerned that these deliberations will change the playing field, and not for the better. (Although it bears mentioning that not since the 1930's have charity sector issues been taken so seriously at Parliament).

 

Looking back at our predictions for 2011 we realize with the benefit of hindsight that some of them were correct but not enough to embolden us to make new predictions for 2012. Nevertheless, you can rely on your team at Drache Aptowitzer LLP to continue to provide you with analysis and guidance about the issues facing the sector as the year unfolds.

 

The entire team at Drache Aptowitzer LLP takes this opportunity to wish you the very best of the holiday season and a happy, healthy and prosperous 2012.

 

 

Yours truly,
Drache Aptowitzer LLP

CRA Provides Guidance to Charities Continuing Under the New Federal Act
By: Joel Secter Joel Secter  

Registered charities that are federally incorporated under Part II of the Canada Corporations Act ("CCA") have until October 17, 2014 to continue under the new Canada Not-for-profit Corporations Act ("NFP Act"). According to Corporations Canada, corporations that have not completed the transition by this date will be considered inactive and will be dissolved. Dissolution could have serious consequences for registered charities including revocation and possibly forfeiture of corporate assets. For this reason, all registered charities are strongly advised to make continuing under the new federal law a priority sooner rather than later

  

For more information click here:

By: Arthur Drache C.M., Q.C. 

 

It has been more than a decade since the federal government embarked on a course of making it easier to donate significant amounts to charities with changes ranging from increasing the annual basic limit of donations from 20 percent to 75 percent and, more importantly, over time introducing many rules to facilitate in kind transfers such as stock, stock options and certain types of real estate



 

To read the full article click here:

 
 
Old Act to New Act: Transition Guidance for Federal Not-for-profit Corporations
 

Yvonne Chenier

 

All organizations that are incorporated under Part II of the Canada Corporations Act ("old Act)" should now be asking questions such as when do I have to continue under the Canada Not-For-Profit Corporations Act ("new Act") and what considerations do I have to think of before I take steps. The Charities Directorate makes it very clear that any such corporation that is a registered charity should definitely make the transition before the October 17th, 2014 deadline or they could find themselves dissolved and potentially having to pay revocation tax equal to 100% of the value of their remaining assets!


To see the rest of this article click here:  

Guilt By Association and the Related Business Rules
By: Adam Aptowitzer 
Adam Aptowitzer

Many people are aware that charities can engage in related business only where the business activity is (in the CRA's view) both related, and ancillary, to the organization's charitable activities. On the other hand, charities can engage in any business activity so long as 'substantially all persons employed by the charity in the carrying on of that business are not remunerated for that employment' (i.e. volunteers).

 

To read the full article:

___________________________________________________________ 
Drache Aptowitzer LLP
Ottawa
226 MacLaren Street
Ottawa, Ontario K2P 0L6 
T. 613.237.3300  F. 613.237.2786

Calgary
West Tower - Sun Life Plaza
144 - 4th Ave. S.W.
Suite 1600
Calgary, AB T2P 3N4

T. 403.536.7442  F. 403.800.3094