Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
NON-PROFIT ORGANIZATIONS
SPEAKING NOTES FOR DENIS LEFEBVRE
QUESTIONS FROM XXXXXXXXXX
WANTS TO KNOW WHY HE CANNOT GET AS MUCH INFORMATION ON NON-PROFIT ORGANIZATIONS AS ON CHARITIES.
RESPONSE
1.WHAT A NON-PROFIT ORGANIZATION IS AND ITS TAX STATUS.
-IT IS A CLUB, SOCIETY OR ASSOCIATION OTHER THAN A CHARITABLE ORGANIZATION OR FOUNDATION.
-ORGANIZED AND OPERATED EXCLUSIVELY FOR SOCIAL WELFARE, CIVIC IMPROVEMENT, PLEASURE, RECREATION, OR ANY OTHER PURPOSE EXCEPT PROFIT.
-NO PART OF ITS INCOME MAY BE PAID OR OTHERWISE AVAILABLE FOR THE PERSONAL BENEFIT OF ITS PROPRIETOR, MEMBERS OR SHAREHOLDERS.
-IT IS EXEMPT FROM PART I TAX BY VIRTUE OF PARAGRAPH 149(1)(l).
-IF ITS MAIN PURPOSE IS TO PROVIDE DINING, RECREATIONAL OR SPORTING FACILITIES, IT IS TAXABLE ON CERTAIN INCOME FROM PROPERTY AND CAPITAL GAINS.
-DETERMINATION OF WHETHER AN ORGANIZATION QUALIFIES CAN ONLY BE DONE AT THE END OF A FISCAL PERIOD BY REVIEWING ITS ACTIVITIES.
2.TYPE OF INFORMATION THE DEPARTMENT PROVIDES.
-INTERPRETATION BULLETIN IT-496 "NON-PROFIT ORGANIZATIONS"
-PROVIDES GUIDELINES ON HOW AN ORGANIZATION QUALIFIES
-INTERPRETATION BULLETIN IT-83R3 "NON-PROFIT ORGANIZATIONS - TAXATION OF INCOME FROM PROPERTY"
-PROVIDES DETAILS CONCERNING ITS TAXABILITY ON CERTAIN PROPERTY INCOME.
-INTERPRETATION BULLETIN 409 "WINDING UP OF A NON-PROFIT ORGANIZATION"
-PROVIDES GUIDELINES ON THE TAX CONSEQUENCES OF THE WIND-UP OF A NON-PROFIT ORGANIZATION.
3.FILING REQUIREMENTS
-PRIOR TO 1993, NO UNIFORM REQUIREMENT TO FILE, ONLY REQUIRED IF THE NON-PROFIT ORGANIZATION WAS A CORPORATION OR TRUST.
-THE AUDITOR GENERAL COMMENTED ON THIS IN HIS 1990 REPORT.
-IN THE JUNE 1992 TECHNICAL NOTES, SUBSECTION 149(12) WAS INTRODUCED TO REQUIRE UNIFORM FILING OF AN INFORMATION RETURN FOR YEARS AFTER 1992.
-INFORMATION RETURN REQUIRED IF TOTAL INCOME FROM CERTAIN SOURCES EXCEEDS $10,000, OR IF ASSETS EXCEED $200,000.
-ONCE REQUIRED TO FILE AN INFORMATION RETURN, IT MUST ALWAYS BE FILED ON AN ANNUAL BASIS.
4.STATISTICS.
-IN 1986 IT WAS ESTIMATED THAT THERE WERE 60,000 NON-PROFIT ORGANIZATIONS.
-IN THE AUDITOR GENERAL'S 1990 REPORT THE NUMBER WAS NOT KNOWN.
-WITH THE NEW FILING REQUIREMENTS, IT WILL BE POSSIBLE TO ESTIMATE THE NUMBER THAT MEET ONE OF THE FILING REQUIREMENTS, HOWEVER THE SMALLER ORGANIZATIONS WILL NOT BE INCLUDED IN THIS ESTIMATE.
5.COMPARISON TO CHARITIES.
-CHARITABLE ORGANIZATIONS OR FOUNDATIONS MUST BE REGISTERED TO HAVE TAX EXEMPT STATUS.
-A DONATION TO A REGISTERED CHARITY QUALIFIES FOR A TAX CREDIT, CONTRIBUTIONS TO NON-PROFIT ORGANIZATIONS DO NOT.
-THE DEPARTMENT HAS A CHARITIES DIVISION BECAUSE OF THE LARGE VOLUME.
-ALL REGISTERED CHARITIES MUST FILE AN INFORMATION RETURN AND A PUBLIC INFORMATION RETURN IN ACCORDANCE WITH SUBSECTIONS 149.1(14) AND (15).
-IN ADDITION TO VARIOUS INTERPRETATION BULLETIN'S, THE DEPARTMENT ALSO PUBLISHES INFORMATION CIRCULARS AND PAMPHLETS CONCERNING CHARITIES.
-STATISTICS ARE EASILY AVAILABLE DUE TO THE FIRST FOUR FACTS.
B. Kerr
957-2139
941583
June 20, 1994