The CRA Charities Directorate has released new resources in 2014 that will be of interest to charities and their donors.
New Videos on Political Activities
CRA has released three short videos that provide an outline of the rules related to political activities. As part of the 2012 Budget, CRA was provided with additional funding to support its education and compliance activities in relation to political activities. CRA has published various resources related to political activities, which should be reviewed by any organization that engages (or may engage) in public calls to action to encourage political change, or which engages generally in public policy analysis and/or advocacy and wants to ensure that it fully understands the rules.
CRA Updates Charities Media Kit for 2013-2014
CRA recently updated its online Charities Media Kit to include data from the 2013-2014 fiscal year (ending March 31, 2014). The Media Kit provides information on various aspects related to the regulation of registered charities. It also includes facts and figures on the Charities Directorate’s activities in 2013-2014. The Kit confirms as follows for 2013-2014:
- as of December 31, 2013, there are a total of 86,617 registered charities;
- CRA conducted 845 audits of registered charities;
- CRA revoked 695 registered charities for failing to file their T3010 returns;
- CRA revoked the registration of 23 charities for cause;
- CRA received 3917 new applications for charitable registration; and
- CRA received 418 applications for re-registration.
These statistics confirm the importance of filing T3010 returns on time each year. The T3010 is required to be filed within 6 months of a registered charity’s year end. Failure to file the information return on time initiates in an automatic revocation process. Once a charity has been de-registered for failure to file, it must re-apply for registration and pay a $500 fee. It is clear from the statistics in the Media Kit that failure to file the T3010 return is by far the most common reason for revocation.
The statistics also show that charities should be aware that CRA is an active regulator and audits a significant number of registered charities each year. Some audits arise through random selection, while others follow-up on possible non-compliance or complaints. It is important that charities review their compliance with the rules in the Income Tax Act regularly so as to be prepared in the event of an audit. Charities that have entered into past compliance agreements with the Charities Directorate, or which engage in activities that tend to draw particular CRA scrutiny (e.g., foreign activities) should be particularly vigilant, as they face a higher risk of audit.