Charities and CRA, make the connection


Each year students from my school help out local charities by volunteering our time. This year I'm canvassing for the local hospital. And it's been… interesting.

All right, let's start with yesterday – my first day on the "job".

I have to admit it didn't go so well. I didn't expect people would have so many questions.

Mr. Gupta, my neighbour, asked me how his donation would be spent. I told him that money would go to "equipment and stuff". He was not too impressed.

I didn't know that registered charities have to file an annual return with the Canada Revenue Agency and that it's available online for anyone to view. Just a few clicks on their website and I could have found tons of information on the charity's activities and financial details.

The CRA even breaks down expenses into what is spent on programs, fundraising, and management and administration. Just the kind of stuff Mr. Gupta was looking for.

Well… I didn't want to get caught again, so this time I did a bit more homework.

The fact is, the CRA website has TONS of information on registered charities.

Did you know that registered charities have a whole series of rules they have to follow in order to maintain their status?

For example, registered charities have to devote their resources exclusively to charitable activities. Of course, charities have fundraising and administrative expenses to support their operations, but these should never overshadow charitable activities.

If a charity breaks any of these rules they risk financial penalties, having their receipting privileges suspended, or having their registration revoked.

A lot of people don't know this!

So… I think I've done pretty well… mostly because I've been able to answer so many questions, even some tough ones.

My philosophy professor, Mrs. Cousineau, had a lot of questions. First she wanted to know how much charities can pay their employees. I explained to her that charities need qualified employees and are allowed to pay them a fair salary for what they do, but no more.

She also wanted to know what was included in administration costs. I explained to her that they're the costs of running board meetings, maintaining books and records, and staffing, and other administrative services.

But, with all that info I was able to give her … I got her donation!

Then there was the Mayor. He asked if the Hospital would endorse him in the next election. I explained to him that a registered charity can use some of their resources to lobby politicians and government officials about laws and public policy, but they can't support or oppose a political party or a candidate for public office. He gave me $2.

Hey. Do yourself a favour. If you're doing some fundraising for charity or thinking of making a donation yourself, visit the CRA on line at or call 1-800-267-2384 and take a moment to learn more about registered charities. I'm sure glad I did.

See ya!

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