ARCHIVED - Policy Commentary

Release Date
September 4, 2009 (Revised March 21, 2011)

Reference Number
CPC-030

Subject
Charitable organizations outside Canada to which Her Majesty in right of Canada has made a gift - How to be considered for inclusion in the Attachment to IC84-3R, Gifts to Certain Charitable Organizations Outside Canada.

Purpose

To clarify how the Charities Directorate determines whether a charitable organization outside Canada, to which Her Majesty in right of Canada has made a gift, meets the requirements for qualified donee status.

Commentary

A charitable organization outside Canada to which Her Majesty in right of Canada (the federal government or its agents) has made a gift during a calendar year or in the 12 months immediately preceding that calendar year for individual donors, or during the fiscal period or in the 12 months immediately preceding that fiscal period for corporate donors, may become a "qualified donee" under the Income Tax Act. Qualified donee status entitles the charitable organization outside Canada to issue receipts for income tax purposes that donors can use on a Canadian income tax return. The list of charitable organizations outside Canada that have become qualified donees under this provision can be found in Attachment to IC84-3R, Gifts to Certain Charitable Organizations Outside Canada (the Attachment).

To have the name of a charitable organization outside Canada added to the Attachment, the federal department that made the payment, or the recipient organization itself, should forward the following information to the Charities Directorate:

• a copy of the governing document of the foreign entity;
• a description of the foreign entity's activities;
• a copy of the letter or certificate issued by the foreign authority granting the foreign entity charitable status;
• copies of correspondence, agreements, or other document related to the Crown gift; and
• proof that the gift has been made (for example a copy of the cheque).

The Charities Directorate will then consider whether the charitable organization outside Canada qualifies based on a two-part test. First, the organization must demonstrate that it was the recipient of a gift. Second, the organization must demonstrate that except for the residency requirement, it would meet the Canadian common law definition of charitable, and would generally be eligible for registration in Canada.

Once the Charities Directorate has determined whether a gift has been made and whether the charitable organization outside Canada would meet the registration requirements, it will provide written confirmation of its decision. If the charitable organization outside Canada meets the two-part test, its name will be added to the Attachment.

The Attachment is modified from time to time to reflect additions and deletions to the list of organizations.

References

• Gift(donation), CSP-G01.
• Qualified donees, CG-010.
• Income Tax Act, R.S.C. 1985 (5th supp.) c. 1, subparas. 110.1(1)(a)(vii), (viii), para. 118.1(1)(g.1) and ss. 149.1(1).