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Charities Program Update from CRA

Charity law and policy, Income Tax Act

Charities Program Update from CRA
Last year, CRA’s Charities Directorate launched the Charities Program Update, a new communication to highlight some of the Directorate’s resources, analysis and statistical data. It appears that the Charities Program Update is being produced on an annual basis, and the 2014 version has just been released. A copy of the 2014 Charities Program Update (the “Update”) is available on CRA’s website.

The Update contains some general information about the Charities Directorate’s activities and publications over the past year, which CCCC regularly reports on through this blog and our Horizons periodical in the CCCC Bulletin. However, the Update also contains some interesting new information, including statistics related to applications for charitable registration and CRA audits, as well as details about how CRA is conducting its review of charities engaged in political activities. These and other items of note are discussed below.

Charities Listing Data Now Available in Spreadsheet Format

As of January 30, 2104, researchers and other interested parties may access public data extracted from charities’ T3010 returns in a searchable spreadsheet format. The data is available on the Government of Canada’s data website. The Update notes that this data is updated every year and so the spreadsheets provide “just a snapshot of the Form T3010 returns at a specific point in time.” Nevertheless, sector researchers will no doubt find this information of interest.

Interesting New Statistical Information

The Update provides the following new statistics from the Charity Directorate’s activities in 2012/13:

  • Applying for registration. Applicants for charitable registration are often curious how many applications are successful. In 2012/13, CRA processed 4,456 applications as follows:
    • 2,060 registrations and re-registrations;
    • 283 denials;
    • 1,636 applications returned to the applicants because of incomplete or missing information;
    • 271 applications withdrawn by the applicants; and
    • 206 applications abandoned (meaning that the applicant never responded to CRA’s request for more information).

Applicant charities should note the high number of applications returned due to incomplete/missing information, and should also be mindful that each application will be assessed on its own merits. For information about starting a charity and the application process, see CCCC’s resources here.

  • Compliance activities. The Charities Directorate completed 799 audits in 2012/13, resulting in:
      • 61 requiring no action;
    • 460 education letters;
    • 178 compliance agreements;
    • 1 penalty;
    • 30 revocations for cause;
    • 38 voluntary revocations;
    • 9 annulments;
    • 1 suspension;
    • 4 re-registration/pre-registration reviews; and
    • 17 recorded as having other outcomes.
  • Loss of registered status. Once again, the most common reason for charitable status being revoked by CRA is failure to file the annual Form T3010 Return. In 2012/13, this resulted in the revocation of 713 charities’ registered status. CCCC has a number of resources to assist charities in the completion of the T3010 form, available on our website.

Information about Monitoring Political Activities

Perhaps the most interesting new information contained in the Update is a discussion of how CRA is handling its recent mandate to increase its surveillance of charities involved in political activities. CRA had previously announced that an audit team had been created to specifically focus on political activities. The Update provides information about how CRA is conducting its reviews of charities in this area.

First, CRA screens charities for potential compliance issues, based on its own files as well as “other publicly available documents that may be relevant”, including T3010 returns, complaints or concerns from the public, referrals from other divisions of the Directorate, and related files found during an audit. In addition, CRA also identifies organizations “through the media or other publically available sources.” Once this screening process is complete, CRA decides if additional action is required – this may result in an audit (either a regular or focussed political activities audit), an information letter, or an office review, depending on the severity of the initial findings (see the Update for details).

As of January 2014, CRA has screened 403 files for political activity issues. Of these, 140 involved reporting errors in the T3010, but 31 have resulted in a decision to send charities a “reminder letter.” In addition, there are still 31 files in “various stages of the audit process.” These 31 charities are said to represent a “broad segment of the charitable sector” with two charities registered to relieve poverty, four to advance education, three to advance religion, and 22 established for other purposes beneficial to the community (including those established to promote health, uphold human rights, promote animal welfare, protect the environment, and community organizations). The Update does not indicate whether CRA intends to revoke the registration of any charities currently under review, but does state that some of the audits have “serious issues of non-compliance, which could justify revocation of registered status.” CRA also notes that it expects to conclude at least two audits with education letters and four more with compliance agreements by March 31, 2014. In addition, CRA’s political activities audit team plans to conduct 50 more audits by 2016.

The information contained in the 2014 Charities Program Update is interesting as well as helpful. The sector will no doubt appreciate this additional information, particularly as many have had questions about the political activities auditing process. The Update should also serve as a reminder to charities that CRA is prioritizing its monitoring of political activities, and it is important to be aware of the relevant rules. CCCC has a number of resources to educate and assist our members in this regard, available on our website.


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.

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