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Financial Management

Senate of Canada to study charitable sector

On January 30th, 2018, the Senate of Canada passed a motion to appoint a Special Committee of the Senate to review issues related to the charitable sector in Canada. The Senate confirmed that the Committee’s general mandate will be to examine “the impact of federal and provincial laws governing charities, non-profit organizations, foundations, and other similar groups, and to examine the impact of the voluntary sector in Canada.”

 

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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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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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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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Social impact bonds – investing in communities

Social Impact Bonds (SIBs) are an innovative way for organizations to practice Socially Responsible Investing (SRI). Canada joins other jurisdictions like the United Kingdom, the United States and Australia, in investing in SIBs.

 

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Revenue Generation for Charities

The Canada Revenue Agency’s policy statement, “What is a related business?”, describes the rules charities need to follow when considering a revenue-generating activity.

 

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Much ado about nothing? Why directors should think about committee governance

Most not-for-profit organisations establish one or more committees to perform various roles. These committees can play an important role in the proper management and governance of the NPO.

 

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The future of risk management

The Institute of Risk Management has a great feature where they have asked people around the world, including a number of luminaries, about the future of risk management.

 

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Charities and not-for-profits: Beware the usual rules

Charities and not-for-profits are obviously subject to a layer of laws that are related to their special status. Often overlooked though, is that they are equally subject to the same rules and regulations as other economic actors. Indeed, sometimes there are linkages between these two worlds making the need for good legal awareness that much more critical.

 

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Practical tips for effecting a successful merger

This article sets out the practical benefits and challenges of merging two charities and some post-merger considerations to effect a smooth transition.

 

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Church and religious organizations: Maybe Adam and Eve could have appealed their sentence

We are often contacted by charities seeking to insulate themselves from potential legal action by disgruntled former members of their organization. This typically results from situations where the individual has been kicked out of the organization for specific misconduct. Although, for the most part, these disputes result in acrimonious name calling from time to time, these matters are litigated. A recent decision of the Alberta Court of Appeal is one circumstance where an irate former member of the Jehovah’s Witnesses took the matter to Court.

 

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Federal Budget 2017-18: Impact on businesses

federal budget 2017

On March 22, 2017, Canada’s Finance Minister Bill Morneau tabled the Liberal Government’s Federal Budget 2017, Building a Strong Middle Class, which includes various measures affecting businesses. The federal budget 2017 is modest and is focused on skills training, innovation and how Canada will promote sustainable growth. The government is forecasting a deficit of $28.5-billion, […]

 

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