Articles 2022

Two pieces of draft legislation – one to make technical amendments to the Income Tax Act (“ITA”) and Income Tax Regulations (“Regulations”), and one to implement parts of Budget 2022, among other proposals, by amending the ITA and Regulations – have been released. This article, which is Part III of a Three-Part series, will discuss other updates contained in the draft legislation.

Two pieces of draft legislation – one to make technical amendments to the Income Tax Act (“ITA”) and Income Tax Regulations (“Regulations”), and one to implement parts of Budget 2022, among other proposals, by amending the ITA and Regulations – have been released. This article, which is Part II of a Three-Part series, will updated reporting requirements for trusts.

Two pieces of draft legislation – one to make technical amendments to the Income Tax Act (“ITA”) and Income Tax Regulations (“Regulations”), and one to implement parts of Budget 2022, among other proposals, by amending the ITA and Regulations – have been released. This article, which is Part I of a Three-Part series, will discuss the disbursement quota.

New regulations subject crowdfunding services to significant obligations, including keeping records of certain clients, fund raising purposes and some beneficiaries and verifying the identity donors giving more than $1000. Charities should take note that personal identifying information regarding crowdfunded donations will be provided to FINTRAC just like donations through the traditional banking system and may be shared with other agencies within the federal government.

In Human Concern International v Canada, 2022 FCA 41, the Federal Court of Appeal (FCA) dismissed an appeal by Human Concern to postpone the one-year suspension of its receipting privileges.

In a rare decision, the Federal Court of Canada found a party in contempt of court for breaching the terms of two previous judgments concerning copyright infringement, resulting in a severe fine and imprisonment of a director of the infringing. It serves as a reminder that courts take intellectual property protection seriously and will impose liability on both infringing corporations and on their directors when necessary and appropriate.

A decision from the Ontario Superior Court of Justice emphasized that a tax-exempt organization that receives a gift from an individual’s estate cannot spend the funds as it wishes. Rather, funds must be used according to the terms of use set out in the will. The court, in its January 31, 2022 unreported decision of County of Bruce v Office of the Public Guardian and Trustee, ultimately concluded that the funds from the estate were misused and that there had been a breach of trust.

Do you work with or are you part of a community organization, an Indigenous Community or organization or a local government? Applications for Ontario’s 2022-2023 Inclusive Community Grants are now available. These grants provide up to $60,000 for a local project to help older residents and people with disabilities participate in community life. Priority projects are those that support under-served communities and that address COVID-19 related challenges. Applications are due March 3, 2022.

Mandate letters issued by the Prime Minister include direction to introduce amendments to the ITA that would make certain organizations ineligible for charitable status. It remains to be seen what amendments may be introduced, but the proposal is concerning as it specifically targets an existing segment of the sector and it could have unintended long-term consequences for all charities. Any proposed amendments therefore need to be carefully monitored.

Are you looking for information about community impact investing? Two resources are now available for charities and not-for-profits in Ontario from the Cooperation Council of Ontario, Ontario Trillium Foundation and Canadian CED Network. There is a report to help you understand the current state of community investment organizations in Ontario and a guide that outlines the phases of development for community investment cooperatives.