Charity Highlights of Budget 2016

Authored by Philip Milley.

The 2016 Federal Budget tabled in the House of Commons by the Hon. Bill Morneau has two references to charities.

The first deals with the donations of real estate and shares of private corporations.  The 2015 Budget proposed to provide, beginning in 2017, an income tax exemption for capital gains on certain dispositions of private corporation shares or real estate, where cash proceeds from the disposition are donated to a registered charity or other qualified donee within 30 days.  The new government has decided not to proceed with this measure.  Along with other groups, the Canadian Council of Christian Charities (CCCC) had advocated for the tax exemption.  The removal of this tax exemption is unfortunate.

The second reference pertains to rules governing charities and their political activities.  The 2016 Budget announces that the Canada Revenue Agency, in consultation with the Department of Finance, will engage with charities through discussions with stakeholder groups and an online consultation to clarify the rules governing the political activities of charities.  CCCC has recognized for some time the troublesome burden that the tracking of political activities of charities has caused its members.  We hope that the rules ultimately developed will help, and not hinder, the work of charities in carrying out their mission.

The full Budget can be found here.

Noteworthy is provided for general information purposes and does not constitute legal or professional advice. Every organization’s circumstances are unique. Before acting on the basis of information contained in this blog, readers should consult with a qualified lawyer for advice specific to their situation.