Books and records

A registered charity is required to keep adequate books and records. This not only makes it easier for you to complete your annual T3010 return but also helps demonstrate that your charity is using its resources for charitable purposes.

Books and records should be kept in either English or French. If they were originally created in a different language, a translated version must be available.

These records must allow us to:

verify all revenue, including charitable donations received
ensure resources are spent on charitable programs
confirm that your charity's purposes and activities are charitable
verify that your charity continues to meet the requirements to maintain its registration under the Income Tax Act

Examples of books and records

Here are some examples of books and records:

accountant’s working papers
annual reports
bank statements
cancelled cheques
contracts
copies of official donation receipts
copies of T3010, Registered Charity Information Returns
expense accounts
financial statements
fundraising materials
governing documents
- incorporating documents
- constitution
- trust document
- bylaws
internal trust documents
inventories
intermediary agreements
investment agreements and prospectuses
ledgers
meeting minutes
payroll records
promotional materials
source documents
- bank deposit slips
- delivery slips
- formal contracts
- invoices
- purchase orders
- vouchers
- work orders
written agreements

Where to keep books and records

Books and records must be kept at the Canadian address that you have on file with us. This includes records related to any activity carried on outside Canada.

How to keep proper books and records

Here are general guidelines for keeping books and records:

You should keep all your charity’s books and records in one area for easy access. This will make it easier for your charity in the case of an audit or when there is a change to your governing board.
You can keep books and records in a paper format or electronically.
You should also keep a copy of your books and records in another location for backup purposes. This copy can also be kept either on paper or electronically.
You are responsible for making your books and records available to CRA officials. These officials are authorized to inspect, audit, copy, or examine a charity's records.
If you hire a third party such as an accountant or bookkeeper to maintain your records, you are still responsible for meeting all requirements.

Guidelines for keeping electronic books and records

Books and records that are created and maintained in electronic format must be kept in an electronically readable format, even if your charity has paper printouts of the electronic records. An electronically readable format means the information is supported by a system capable of producing an accessible and useable copy that would allow auditors to process and analyze the electronic records on CRA equipment.
If any source documents are initially created, transmitted, or received electronically, they must be kept in an electronically readable format.
Scanned images of paper documents, records, or books of account that are maintained in electronic format are acceptable if proper imaging practices are followed and documented.

Note

Books and records maintained outside Canada but accessible electronically in Canada do not meet the requirement of being kept in Canada.

How long to keep books and records

Duration	Type of records
Two-year retention You must keep these receipts for two years from the end of the calendar year that you received the donations. If you cancelled or reissued donation receipts, you must keep these records for two years after the end of the calendar year in which the receipts were cancelled or reissued.	Copies of official donation receipts
Six-year retention If your charity is registered, you must keep these records for six years from the end of the fiscal year that they cover. If you didn’t file your T3010 on time, you must keep these records for six years from the late-filing date. If your charity is revoked, you must keep these records for two years after the date of revocation.	General ledger or other books of final entry containing summaries of year-to-year transactions and the accounts necessary to verify the entries Financial statements Source documents Documents showing your purposes and activities are charitable, such as annual reports, promotional material, and written agreements T3010 Registered Charity Information Returns
Indefinite retention If your charity is registered, you must keep these records indefinitely. If your charity is revoked, you must keep these records for two years after the date of revocation.	Meeting minutes of directors, trustees, members, and staff Governing documents and bylaws

To destroy books and records before the required duration has passed, you must obtain the Minister of National Revenue’s written permission. To do so, fill out Form T137, Request for Destruction of Records and send it to:

Charities Directorate
Canada Revenue Agency
Ottawa ON K1A 0L5

Consequences of not keeping adequate books and records

Failure to keep adequate books and records may result in sanctions, such as monetary penalties, the suspension of your charity's tax-receipting privileges, and the loss of its registered status.

References

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Date modified:: 2016-07-21

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