Accountability for the use of resources for political activities

  • The Income Tax Act requires a charity to keep books and records that show it continues to qualify for registration as a charity.

    • This means that a charity must keep books and records that demonstrate that any political activities it carries out comply with the Act.

    • A charity’s books and records can include, but are not limited to, invoices, ledgers, records of volunteer hours worked, contracts, and minutes of board meetings.

  • The Canada Revenue Agency recognizes that charities may use different methods to track the use of their resources, but a charity must always be able to show which resources are used, how they have been used, and for what activity. For example, a charity might examine and track the following types of resources devoted to political activities:

    • Financial resources – All financial expenditures, including salary and other human resource costs

    • Capital assets – The percentage of use of building and office space, the percentage or amount of proceeds or withdrawals from the charity’s investments that are spent on political activities

    • Volunteer time and donated resources – The percentage of volunteer hours or number of volunteers, and the percentage or amount of donated resources that are devoted to carrying out the charity’s political activities

  • The onus is always on the charity to account for its use of resources.

  • A charity should use a reasonable and consistent method to calculate its expenditures on, or use of resources devoted to, political activities.

  • For more information on what kinds of records a charity needs to keep, and for how long, go to Keeping records.

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