Last updated: June 3, 2014
Political Activity Reporting: T3010-14
Of interest to treasurers! Why do we track political activity?
Canadian charities must report the amount spent on political activity on their charitable tax filing (form T3010). That should include a reasonable proportion of staff costs if appropriate. On form T3010, Section C5 asks:
- Did the charity carry on any political activities during the fiscal period?
- Enter the total amount spent by the charity on these activities.
Amount (b) must be entered again on line 5030 reporting income and expenses of the charity. For 2013 onwards, Schedule 7 must also be completed describing the nature and purpose of any political activity.
Congregations should review their activities to see which might be deemed “acceptable political activity” and then develop systems to track how resources are being used to support that activity. The systems need not be complicated but should show a diligent effort to account for expenses, including any allocation of staff time and the associated cost. For T3010 reporting purposes, the amount you calculate will typically be quite small and well within the 10 percent limit. Accordingly, we advise you to round up your estimate of political activity cost by a small amount to allow for anything you may have forgotten.
Charitable Status and Helping Other Organizations
Churches and other charities should NOT accept donations (with tax receipting) designated for other organizations that do not have charitable status. This is called being a conduit and is expressly prohibited by charity law. In the charity world it is the equivalent of money laundering.
And, if there is no tax receipting, there is no reason to run the money through the church at all. Folks can donate directly to the other organizations.
Both of these concepts respect charity law and the notion that our churches are required to limit their activities to their “own charitable activity,” which they conduct directly or through entities over which they have “direction and control.”
In the case of helping a non-charity with a grant, great care must be taken in setting up a formal arrangement that would allow the church board to assert it has direction and control over the enterprise. To the extent money flows into the church, the outflow needs to be compliant with charity law. Ideally you would have a memorandum of understanding with the organization that documents that the church charitable purpose aligns with the organization you want to help. Then there would be a trustee agreement that demonstrates on what conditions you receive and subsequently disburse the money. For most churches, this might be too complex an undertaking and it is best to say no—with regret.
Note that if you receive a big grant and disburse it, it also has to show on your financial statements and charitable filings.
Changes to Federal and Provincial Non-Profit Corporations Legislation
The federal and Ontario governments are both updating legislation on non-profit corporations. This does NOT impact our congregations in any way. Congregations, presbyteries, and Confernences are NOT incorporated, so this legislation does NOT apply.
The United Church of Canada is federally incorporated by a Special Act of Parliament, so only the General Council Office needs to respond.
Incorporated ministries do need to take action if federally incorporated or incorporated in Ontario. For more information about incorporated ministries contact
Federal Funding for Accessibility Projects
The federal government periodically announces a call for proposals that may be of interest to ministries considering accessibility projects. Full details are available at Employment and Social Development Canada. Small projects that create or enhance accessibility for people with disabilities may receive up to $50,000 from the federal government. At least 25 percent of the total project costs must come from other, non-federal government sources.
Since the window for applying is often quite short, we recommend you put yourself on the notification list as offered on the government webpage.
Church Finance Webinars
Recorded webinars can be viewed any time. However, we will continue to offer national webinars for topics of seasonal interest. To watch previously recorded webinars, visit our Congregational Finance video album on Vimeo.
I am hearing from across the country that CRA auditors are getting more concerned with cash payments being given to individuals even for modest sums. Technically a charity shouldn't give money to a non-charity (without demonstrating direction and control of what happens to the money). Modest payments from benevolent funds have not been an issue until now. It is always a good idea to purchase vouchers, or pay actual bills, when administering a benevolent fund.
Clergy Residence Deduction
Learn about the administration of the Clergy Residence Deduction to comply with Canada Revenue Agency and Revenu Québec guidelines.
For more information