A charity may close down on a voluntary basis (i.e., upon request by the charity) or on an involuntary basis (i.e., as a result of a Canada Revenue Agency decision). Where the revocation is involuntary, the charity may choose to object or appeal the decision.
No matter how a charity’s status is revoked, the charity may be subject to a revocation tax, which is basically 100% of all its assets. Note that if a charity loses its charitable status as a result of annulment (vs. revocation), it is not subject to the revocation tax and can carry on using those assets as a (non-charitable) not-for-profit. To avoid being taxed, the charity must comply with CRA procedures, such as using the voluntary revocation process.