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Monday, November 7, 2011

Disclosure of Information About Registered Charities

Subsections 149.1(15) and 241(3.2) allow the CRA to publicly disclose information about registered charities. This exception to the general confidentiality rules is intended to reassure the public that donated funds are not misused and to allow people to research a charity before making a donation. My own inquiries about a small sample of charities show that there is room for improvement in the CRA's administration of the rules.
Together, the two subsections allow for the disclosure of information such as the charity's name, location, registration number, date of registration, governing documents, application for registration, directors, financial statements, and notification of registration. Other permitted disclosures include any letter or notice that is a revocation of registration or that relates to a suspension or the imposition of a tax or penalty. Guidance CG-008 ("Confidentiality--Public Information"), dated August 15, 2011, contains a complete listing of permitted disclosures. Although both the Act and the guidance say that the CRA "may" disclose this information, a CRA official has confirmed that all of this information will be disclosed.
Most of the information is readily available on the CRA's Charities website (www.cra-arc.gc.ca/charities). However, some information is lacking for many charities, including financial statements, governing documents, and documentation regarding disciplinary actions taken by the CRA. To determine the ease or difficulty of obtaining this additional information, I telephoned the Charities Directorate on several occasions to ask for specific information about a group of charities. Four of the charities were in good standing, and several others had received some form of sanction. The agents who assisted me with my requests for disclosure clearly made their best efforts to be helpful. Still, I experienced several difficulties:
  • The CRA turned down my request for "all publicly accessible information." It appears that the onus is on the requester to have an in-depth knowledge of what information can legally be disclosed and then to request each item separately.
  • I received the requested material over a three-month period. Some of the delays apparently were caused by the fact that information is stored offsite from the offices of the Charities Directorate. In addition, e-mail delivery is not an option; material can be faxed, but this method is subject to page limits, so postal mail is the most common delivery method.
  • Four months after my original request, an agent called to say that the information that remained outstanding could not be located and the file was being closed. About 20 percent of the information that I requested was never received.
Although the Charities Directorate deserves to be complimented for the generally high quality of its website, the CRA's procedures for supplying information not on the site are neither expeditious nor user-friendly. Perhaps the CRA is doing all it can in an era of budgetary restraint. Disseminating documents such as financial statements and disciplinary communications through a website is certainly not as easy as disseminating the contents of the charities' T3010 returns.
David D'Onofrio
PowerOne Capital Markets Limited, Toronto
ddonofrio@poweronecapital.com


Canadian Tax Focus
Volume 1, Number 3, November 2011
©2011, Canadian Tax Foundation