RC16. How can my organization register as a charity?
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In order to qualify as a registered charity under the Income Tax Act with the Charities Directorate of the Canada Revenue Agency (CRA), your organization has to
- be resident in Canada
- be established and operated exclusively for charitable purposes that are within the four categories of charity identified by the courts
- devote all its resources (financial, personnel, and property) to charitable activities
If these conditions are met, you apply by sending in form T2050 Application to Register a Charity with the required information following the instructions in Guide T4063, Registering a Charity for Income Tax Purposes.More…
In considering registration, an organization has to review its governing document that describes its purposes (objects). The purpose of an organization is the why and the what (end results) of its existence. These purposes have to be within the four categories identified by the courts:
- to relieve poverty
- to advance education
- to advance religion
- other purposes beneficial to the community that the courts have found to be charitable.
If your organization’s purposes do not fall within the four categories, it cannot be registered unless you change its purpose. If it is provincially incorporated, changes have to be filed with the provincial regulatory body.
If the organization does not have a governing document, it will need to draft one. The CRA has a list of model objects that would be acceptable.
Key information that an application for charitable status must include
- the name and address of the organization
- the signature of two persons who are authorized to sign on behalf of the organization
- a statement of each of the organization’s purposes listed in the governing document and the activities to accomplish each purpose. The activities must be specific in order to clearly state what the organization intends to do.
- an explanation of how the organization will make decisions
- an estimate of the organization’s income and expenses (financial statements)
- a governing document that describes the organization’s purposes (also called objects). A governing document is a deed of trust, a constitution, or articles of incorporation (a not-for-profit organization that is incorporated under provincial, territorial, or federal law). This includes bylaws, a current list of directors, trustees, or other similar officials who make up the charity’s elected or appointed governing body with their full names, addresses, and occupations.
- The organization’s bylaws need to contain a clause stating that if the registered charity is dissolved, its remaining asset will be given to a qualified donee.
- information on fundraising activities, keeping in mind that fundraising activities cannot be the main object of a registered charity
- information on political activities. The charity is allowed to spend 10 per cent of its resources on non-partisan political activities to influence law, policy, and public opinion on matters related to its charitable purposes.
- a certificate of good standing. The name of this certificate varies from province to province. The incorporating authority issues this to certify that the organization is duly incorporated and is in good standing with the authority.
Additional information on completing the application form can be found at
Registering a Charity for Income Tax Purposes
Application to Register a Charity Under the Income Tax Act
SEE ALSO: Thinking of Becoming a Registered Charity: Tools to Help published by the Legal Resource Centre and Charity Central.