Topic | Registered charity | NPO |
Purposes | - must be established and operate exclusively for charitable purposes
| - can operate for social welfare, civic improvement, pleasure, sport, recreation, or any other purpose except profit
- cannot operate exclusively for charitable purposes
|
Registration | - must apply to the CRA and be approved for registration as a charity
| - does not have to go through a registration process for income tax purposes
|
Charitable registration number | | - is not issued a charitable registration number
|
Tax receipts | - can issue official donation receipts for income tax purposes
| - cannot issue official donation receipts for income tax purposes
|
Spending requirement (disbursement quota) | - must spend a minimum amount on its own charitable activities or as gifts to qualified donees
| - does not have a spending requirement
|
Designation | - is designated by the CRA as a charitable organization, a public foundation, or a private foundation
| - does not receive a designation
|
Returns | - must file an annual information return (Form T3010) within six months of its fiscal period-end
| - may have to file a T2 return (if incorporated) or an information return (Form T1044) or both within six months of its fiscal period-end
|
Personal benefits to members | - cannot use its income to personally benefit its members
| - cannot use its income to personally benefit its members
|
Tax exempt status | - is exempt from paying income tax
| - is generally exempt from paying income tax
- may have to pay tax on property income or on capital gains
|
GST/HST | - generally must pay GST/HST on purchases
- may claim a partial rebate of GST/HST paid on eligible purchases
- most supplies made by charities are exempt
- calculates net tax using the net tax calculation for charities
| - must pay GST/HST on purchases
- may claim a partial rebate of GST/HST paid on eligible purchases only if it receives significant government funding
- few supplies made by NPOs are exempt
- calculates net tax the regular way
|