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News and discussion on implementing risk management

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Not for Profit

Receipting and donor relations

This case is a reminder that charities need to be mindful of the rules when they issue donation receipts. Donors rely on the receipts in order to claim tax credits/deductions. If the Minister denies a donor’s claim for a tax credit/deduction on the basis that the charity did not include all of the required information, this will reflect poorly on the charity and could harm its relationships with donors.


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Directors’ liability for source deductions

An issue came up when a CRA auditor queried CRA rulings. She had a file where she intended to assess the directors of a not-for-profit corporation for its failure to remit trust funds. The directors had retained legal counsel, who was of the view that directors’ liability does not apply to directors of a not-for-profit corporation.


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Government sin of omission may lead to your sin of commission

In enacting changes to the regime which deals with donations to foreign universities Budget 2018 has created an immediate issue for anybody that donates to these schools. What is unknown is whether this was intentional.


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Employee forfeits $115,000.00 in bonuses by resigning; active employment clause valid

A bonus policy may state that employees who are eligible for bonuses must also be actively employed to receive their bonus payments. That is, employers may institute an “active employment clause”. Courts will uphold valid active employment clauses, as demonstrated by Bois v. MD Physician Services Inc., 2017 ONCA 857 (CanLII). MD Physician Services Inc. […]


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Function and form

A recent decision of the Tax Court illustrates a concept whose importance is only matched by the universality to which it is ignored. The case of Lichtman involved a number of Orthodox Rabbis teaching at an Orthodox Jewish school in Vancouver. The Rabbis claimed what is known as the “Clergy Residence Deduction” and ultimately lost their case.


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Tax court addresses clergy residence deduction for religious teachers

The clergy residence deduction provides for a limited deduction for housing provided to a member of the clergy or supplied by a member of the clergy. It is a deduction that has existed for a long time and seems to have been designed to address the situation of a member of the clergy who is provided with a manse by a local congregation, but who may be expected to use the house in the course of clergy duties.


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CRA guidance: Charitable status for internal divisions

internal divisions

Many larger charities are structured in such a way that there is a head organization with subordinate divisions operating below it. For example, a charity that operates across the country may do so by way of local ‘chapters’ overseen by a main organization, or a religious governing body may have several related parishes.


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Charities can now help businesses in the aftermath of disasters

aftermath of disasters

In August 2017, the Canada Revenue Agency (“CRA”) updated its Guidance CG-014 on community economic development (“CED”) activities and charitable registration. There were a number of updates to the Guidance, but the most significant was the inclusion of the statement that charities are now able to support, on a more long-term basis, the efforts of businesses that are helping to rebuild communities affected by disaster.


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Not-for-profits need a plan to determine whether to take a stand or policy position

Not-for-profits should continuously assess current and emerging issues to determine whether to take a stand or policy position. Emerging issues may be strategically important to the organization and are often time-sensitive; the opportunity to take a stand on an issue may be fleeting because attention may soon be re-directed to something new. Not-for-profits will need […]


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Changes to the Ontario Not-For-Profit Corporations Act, 2010

On November 14th, Bill 154 received Royal Assent. As noted previously, this omnibus bill made changes to the Corporations Act (Ontario), to social investment provisions in the Charities Accounting Act (Ontario), and other statutes. Some of the more significant changes to the Not-For-Profit Corporations Act, 2010 (“ONCA”) are reported here, none of which are in force today but will be when ONCA comes into force. As you may recall, ONCA was passed in 2010, but it will only come into force on a day to be named. The government plans to bring the ONCA in force in early 2020.


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Top 10 most-read Inside Internal Controls posts for 2017 and Season’s greetings

We are signing off with a list of the top 10 most-read Inside Internal Controls posts for 2017. This year on the Inside Internal Controls blog we’ve been covering some of the hot topics in internal controls, governance, information technology, not-for-profit, and business management among others. The top 10 most-read Inside Internal Controls posts for 2017 include:


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It’s giving season: Tax credits for charitable donations vs. political contributions

With the holiday season upon us, many Canadians are turning their minds to both good-will and the end of the tax year. The next time you reach for your wallet to make a donation or contribution, think back on this summary of the differences between the two and reflect on what the tax implications will be.


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Rules around raffles: Don’t get sent up the river for sending rubber duckies down the river

Raffles (or, properly speaking, raffle lotteries) can be a fun, efficient, and relatively non-labour-intensive means of making moderate amounts of money for a not-for-profit or charity. Did you know, however, that the regulatory framework governing raffles (charitable gaming) ultimately flows from the Criminal Code?


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BCCA eyes enforceability of restrictive covenant in IRIS appeal

Restrictive covenants are often a key component of employment agreements and commercial transactions. Enforceability, however, can be challenging, especially in the employment context


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Employee misconduct and social media

As technology continues to blur the line between personal and professional life, employers increasingly find themselves dealing with the impact of social media on the employment relationship.


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