How are non-profits and charities different from other business organizations? How are they different from each other? I can answer these questions and tell you anything else you’d like to know about the reporting standards, the funding landscape and other issues specific to this sector.

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Common questions I’m asked:

What is the difference between a non-profit organization and a charity?

While all charities are non-profits, not all non-profit organizations are charities. Both operate for purposes other than earning a profit and are exempt from tax, but in order to qualify as a charity, an organization must work to alleviate poverty, advance religion, further education or pursue other objectives of benefit to society.

A non-profit’s purposes are unconstrained as long as they exclude profit-making.

Only organizations with charitable status can issue donation receipts.

What annual returns are non-profits and charities required to file?

Although they are tax-exempt, non-profit organizations must file a T2 corporate tax return within six months of their fiscal year end.

Charities must file form T3010-Charity Information Return and all applicable schedules within six months of their fiscal year end.

GST/HST registrants also must complete and submit GST/HST returns according to the filing frequency assigned to them.

What do these terms mean?

Public Service Bodies’ GST/HST Rebate

The GST/HST rules for charities differ significantly from those for other types of businesses. Most supplies made by charities are exempt from GST/HST which means they are not required to register for GST/HST.

Charities can recover 50% of the GST/HST they pay on their purchases by filing a Public Service Bodies’ GST/HST Rebate application.

Restricted fund

The word “fund” means something quite specific in non-profit terminology. It refers to money collected for a specific purpose. Grantors and donors can designate how the recipient non-profit or charity can use their contributions and, in some cases, expect a full accounting to document that their restrictions were respected.

The way we work together is up to you. Seeking regular feedback? Only want to talk to me twice a year? We’ll do whatever works for you and your business. At our initial consultation, we’ll evaluate your circumstances and come up with a plan that suits your information needs and budget.

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Meet some of my NPO and charities clients