| 24(1) | File No. 5-9705 |
| M. Eisner | |
| (613) 957-2138 |
Attention: 19(1)
June 26, 1990
Dear Sirs:
This is in reply to your letter of March 8, 1990 concerning whether the 24(1) is a non-profit organization described in paragraph 149(1)(1) of the Income Tax Act.
24(1)
Our Comments
Whether or not a corporation is a non-profit organization is a question of fact. In this connection, however, we offer the following comments.
The conditions in paragraph 149(1)(1) that an association (corporation) must comply with in order to qualify for exemption as a non-profit organization are set out in paragraph 2 of IT-496. It would appear that the first requirement is not a concern. We also note that in view of the limited information provided to us, we are only able to provide meaningful comments on the second and fourth requirements.
The second requirement is that the association must be organized exclusively for social welfare, civic improvement, pleasure, recreation, or any other purpose except profit. 24(1) In order to satisfy this requirement, the letters patent of a corporation should clearly set out its exempt objectives and indicate that its funds will be used solely in respect of those objectives.
The last condition requires that no part of an organization's income may be payable or be made available for the personal benefit of a proprietor, member or shareholder. Since the documentation you have provided 24(1) For further information in this respect, we would refer you to the comments in paragraphs 11 and 12 of IT-496.
While we have provided you with comments based on the information provided and our understanding of your concerns, the ultimate determination of 24(1) tax status concerning paragraph 149(1)(1) can only be determined following a detailed review of all the relevant facts including 24(1) modus operandi and that, for the purposes of pursuing this matter, you should contact your local District Office whose responsibilities include the making of such a determination.
We trust that the foregoing comments will be of assistance to you.
Yours truly,
for DirectorBusiness and General DivisionRulings DirectorateLegislative and IntergovernmentalAffairs Branch