Articles 2018

Charities that qualify as designated municipalities can be eligible for a rebate from the GST/HST paid on property and services, but does a supply of market rate units for moderate income households qualify? A recent CRA interpretation letter explains how section 259 of the Excise Tax Act and CRA’s info sheet Municipal Designation of Organizations Providing Rent Geared to Income Housing might apply in this situation, and why the charity’s market rate units would not qualify for the rebate.

The COVID-19 pandemic has created unique situations for corporations, including social distancing orders. These orders are challenging in the regular course of business and particularly tricky if an annual general meeting (AGM) timeline fell in the midst of these orders. This paper outlines the most recent federal and provincial legislation relevant to AGMs and provides general guidance to corporations for holding restriction-compliant AGMs.

Can a non-profit organization add a secondary business and use the net income to fund its non-profit objectives? Can it fund the business from a reserve accumulated from excess member contributions held for future capital expenditures? Can it provide services to non-members outside its geographical area? This article will explain CRA’s view on these questions, with reference to the Income Tax Act and Interpretation Bulletin IT-496R.

The Tax Court of Canada decision in Odette (Estate) v the Queen serves as a warning that private foundations and their donors need to be sensitive to the complex rules that apply to them, and in particular to proceed very cautiously when considering making gifts of non-qualifying securities. In this case, the court dismissed an appeal from an assessment denying the taxpayer a charitable donation tax credit. Read the full article for the court’s analysis of s.118.1(13)(c) of the Income Tax Act.

The Federal Court case of Canada (National Revenue) v Miller examines the CRA’s extensive audit powers. It affirms that the CRA can compel the production of any information that should be documented in books and records, even if a transaction was originally an oral agreement. In an audit, charities and NFPs should be prepared to make reasonable efforts to accurately respond to requests for documents and information.

After a lengthy and complicated dispute between members of the Hamilton branch of the Royal Yugoslav Army Combatants’ Association in Canada-Draza Mihailovic (the “RYACA”), the Ontario Superior Court of Justice released its September 1, 2021 decision concerning membership and decision-making rights concerning property owned by RYACA in Varjacic et al. v Radoja et al.

If you are a business, not-for-profit, or charitable corporation incorporated in Ontario, or a foreign business corporation required to report Ontario income taxes, then you are required to file a corporate annual return under the rules of the Corporations Information Act (Ontario).

The Federal Government published a detailed response letter on March 30, 2021 to the Senate’s special report on the charitable and non-profit sector. The 20-page letter from the Minister of National Revenue reviews and responds to all of the 42 Recommendations. This article provides an overview of the Government’s extensive response to the Report and highlights comments of particular interest.

Released 13 months into the pandemic, Budget 2021 is comprised of four parts focussing on various priorities: Finishing the Fight Against COVID-19; Creating Jobs and Growth; A Resilient and Inclusive Recovery; and Fair and Responsible Government. This article provides a summary and commentary on provisions proposed in Budget 2021 that impact the charitable and the not-for-profit sectors.

A recent decision by the Supreme Court of Canada, involving a dispute over whether an agreement governing a parking facility had been adopted by a strata (condominium) corporation, provides a useful summary of basic contract principles applied in the context of a pre-incorporation contract. This decision is important for Ontario not-for-profit corporations and business corporations incorporated in Nova Scotia (even if they operate in Ontario).