Do you need to register?

Non-profit organizations intending on accepting gifts and issuing official receipts for income tax purposes need to register with Revenue Canada for income tax exemption. If your organization has no need for tax-exempt status, then your organization does not need to register.

Do you qualify for registration?

If your organization does need to register with Revenue Canada, you'll need to demonstrate that your organization truly qualifies as a non-profit. There are two principal factors that disqualify your organization for registration.

• The income of the organization may not personally benefit any proprietor, member, shareholder, trustee, or settlor of the organization. This does not prevent the organization from paying for services rendered.
• Your organization may not adopt, promote, support, or seek to achieve any political agenda, party, purpose, or doctrine, nor may your organization seek to persuade the public to adopt a particular social view or attempt to bring about or oppose changes in the law or government policy.

Why should you register?

There are two basic advantages to being a registered non-profit organization. First, the organization will be able to issue receipts for gifts received. These receipts reduce the tax payable for the individual donor, or, in the case of a corporation, reduce the taxable income. The second benefit is that, upon registration, the organization is exempt from paying income tax.

What are your obligations?

Along with the benefits, there are requirements that a non-profit organization must meet in order to maintain its registration:

1. First, the organization must donate its resources to charity.
2. Second, it must continue to meet the requirements that qualified it in the first place.
3. Third, your non-profit must file a Registered Charity Information Return within six months of each year-end.