A registered charity is a tax-exempt organization that has the right to issue charitable donation receipts to its donors. To maintain its status, the organization must operate within the rules and regulations governing charities including a requirement to expend a prescribed amount – its disbursement quota – annually on its approved charitable purposes and activities. A charity that is late or fails to meet its regulatory and administrative requirements is at risk of facing financial penalties, interim sanctions and the involuntary dissolution of its corporation entity and revocation of its charitable status.
Regulatory requirements to maintain good corporate standing include, but are not limited to:
- Maintaining a registered and records office
- Attending to annual meeting requirements
- Maintaining a current corporate Minute Book
- Filing the Annual Report/Summary
Regulatory requirements to maintain registered charity status include, but are not limited to:
- Maintaining an address where financial books and records are kept and available for Canada Revenue Agency audits
- Maintaining copies of official donation receipts issued for verification by Canada Revenue Agency
- Preparation of financial statements
- Filing the Form T3010A, Registered Charity Information Return within six months of its fiscal year end
- Issuing complete tax receipts giving proper consideration to content, eligible amount of the gift and advantage issues
- Following proper procedures for retention and destruction of books and records
(See Benefic Compliance)
