{"id":4432,"date":"2017-12-06T04:18:00","date_gmt":"2017-12-06T04:18:00","guid":{"rendered":"https:\/\/oafdn.ca\/?p=4432"},"modified":"2022-02-12T04:19:04","modified_gmt":"2022-02-12T04:19:04","slug":"legislation-changes-affecting-charitable-organizations","status":"publish","type":"post","link":"https:\/\/oafdn.ca\/fr\/legislation-changes-affecting-charitable-organizations\/","title":{"rendered":"Legislation changes affecting charitable organizations"},"content":{"rendered":"
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\"Canada<\/p>

A number of changes have been recently passed by government affecting charitable organizations. Changes worthy of taking note include:

<\/span><\/span><\/p>

\u00a0<\/p>

\u00a0<\/p>

Charities Directorate<\/strong><\/span>
At the federal level, the Charities Directorate, indicates:<\/span><\/span><\/p>

\u2022 It will no longer review, as part of applications for charitable status, \u2018draft\u2019 governing documents. Governing documents must be in final form.<\/span><\/span><\/p>

\u2022 Online services will come on stream, starting November 2018, to enable charities to file their T3010 annual returns on line, and to make updates their charitable account information.<\/span><\/span><\/p>


Ontario Corporate Reform<\/strong><\/span>
In Ontario, corporate reform legislation, has now been passed. A couple of points for charitable organizations to note state:<\/span><\/span><\/p>

\u2022 A person who is not a member of the organization, may be appointed a Director<\/span><\/span><\/p>

\u2022 Member meetings may be held electronically ( as distinguished from regular board meetings )<\/span><\/span><\/p>

\u2022 If approved by an extraordinary resolution of the Board ( 80% approval), the organization can decide not to have an audit if annual revenue is less than $100,000<\/span><\/span><\/p>


Social Investments<\/strong><\/span>
Draft legislation amending the Charities Accounting Act in Ontario provides clarity around \u2018social investments\u2019 being made by a charity.<\/span><\/span><\/p>

\u2018Social or impact\u2019 investments by a charity generally represent an investment that provides both a financial return and a \u2018social\u2019 return that benefits the public and an organizations\u2019 charitable purpose. Example will be social investments that earn below market rate returns. While such investments have been made for many years, it was always unclear, whether social investments met the \u2018prudent investor\u2019 criteria set out in Trustee legislation.<\/span><\/span><\/p>

The proposed changes to legislation now introduce the term \u2018social investment\u2019 \u2013 one that furthers the purpose of the charity, and achieves a financial return. To meet this definition, there are a number of provisions within the legislation to consider.<\/span><\/span><\/p>

Charities are permitted to make social investments, subject to the following conditions:<\/span><\/span><\/p>

\u2022 The investment can be made, unless the charity is restricted from the investment under its governing documents. If there is no authorization to spend original capital (an endowment), a social investment should not be made if the expectation is that original capital will be spent. A lower financial return is permitted so long as the original capital value is preserved.<\/span><\/span><\/p>

\u2022 The social investment will not be subject to prudent investor standards, applicable to other\/portfolio investments. A social investment does not have to be made with the expectation of earning a \u2018market rate of return\u2019, such as can be achieved from a marketable security \u2022 A charity (the Board) must consider whether it needs \u2018advice\u2019 when making a social investment and to follow such advice. It must (as with any investment), periodically review its social investments from time to time.<\/span><\/span><\/p>

\u2022 The board must be satisfied the investment is in the best interests of the charity<\/span><\/span><\/p>


The changes will be helpful to provide clear legislative authority for a charity to make social investments. Boards will want also to look at such investments with a view to CRA\u2019s view that a charity can\u2019t make investments at below market terms to \u2018non-qualified\u2019 donees, which could be considered to be a \u2018gift\u2019 to the person\/entity receiving the investment. It will be important to ensure that the social investment is structured as a \u2018program related\u2019 investment (one linked to the organization\u2019s charitable purpose), or is made to a qualified done within CRA requirements.<\/span><\/span><\/p>

Boards considering social investments within their mission\/investment strategies should consider carefully the legislative changes, and move forward with the benefit of professional advice.<\/span><\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>","protected":false},"excerpt":{"rendered":"

A number of changes have been recently passed by government affecting charitable organizations. Changes worthy of taking note include: \u00a0 \u00a0 Charities DirectorateAt the federal level, the Charities Directorate, indicates: \u2022 It will no longer review, as part of applications for charitable status, \u2018draft\u2019 governing documents. Governing documents must be in final form. \u2022 Online […]<\/p>\n","protected":false},"author":1,"featured_media":4433,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"give_campaign_id":0,"nf_dc_page":"","site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[16],"tags":[],"class_list":["post-4432","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"yoast_head":"\nLegislation changes affecting charitable organizations - Ontario Arts Foundation<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/oafdn.ca\/fr\/legislation-changes-affecting-charitable-organizations\/\" \/>\n<meta property=\"og:locale\" content=\"fr_CA\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Legislation changes affecting charitable organizations - Ontario Arts Foundation\" \/>\n<meta property=\"og:description\" content=\"A number of changes have been recently passed by government affecting charitable organizations. 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