Advantages of registration
The main advantages of being a registered charity are:
Registration allows a charity to issue official donation receipts for gifts it receives. These receipts can be used to reduce the income tax payable of an individual donor or the taxable income of a corporate donor.
Once registered, a charity is exempt from paying income tax under Part I of the Income Tax Act.
Registered charities are eligible to receive gifts from other registered charities, such as foundations.
Registration provides increased credibility in the community, since registered charities must follow certain rules and guidelines in order to maintain their registration.
Many goods and services provided by registered charities are exempt from goods and services tax/harmonized sales tax (GST/HST). Also, in many situations, registered charities can claim a partial rebate for the GST/HST they pay.
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