Policy Statement

Applicants with Broad Object Clauses

Reference Number
CPS-004

Effective Date
October 10, 1990

Purpose
This policy statement outlines the Directorate's policy on the registration of applicant organizations that have broad object clauses in their governing documents.

Statement
In order to qualify for registration as a charity, an applicant's governing documents must demonstrate that their objects[Footnote 1] are restricted to the realm of charity as recognized by law[Footnote 2]. Some applicants have broad object clauses. The accompanying statement of activities often supports and confirms the exclusively charitable intent of broad, and apparently acceptable objects. When the statement of activities insufficiently describes the objects, further details will be required. However, if the objects are so broad that they exceed the bounds of charity, the applicant cannot be registered.

Implementation

1. This policy applies to the objects and activities of applicant organizations and registered charities.

The problem with broadly worded objects

2. Applicants frequently state their objects as broadly as possible to allow them the greatest of flexibility. However, because of the requirements of the law, such broadly worded objects are only acceptable for registration purposes if they still restrict the applicant to exclusively charitable pursuits[Footnote 3].

3. Examples of broad yet acceptable objects are:

1. "to fund and carry out activities and programs that are beneficial to the community as a whole, in a way which the law regards as charitable", or
2. "to relieve poverty through charitable means".

4. Examples of broad but unacceptable objects are:

1. "to facilitate and encourage community spirit and development", or
2. "to provide a network of information to the public"
3. "to promote philanthropic causes"[Footnote 4].

Statement of activities in applications that include broad objects

5. Applicants must not only be constituted for charitable purposes, they also need to be restricted to activities that are charitable. An applicant that is governed by broad, though apparently charitable objects, or a combination of acceptable specific and broad objects, must provide a statement of activities that confirms the charitable intent of each of its formal objects.

6. If it is not possible to make a connection between specific programs and the acceptable broadly worded objects, it is the Directorate's practice to require applicants to submit a more detailed statement of activities. This is applicable to both incorporated and unincorporated applicants. No specific format is required, but the statement should not be so open-ended as to allow an applicant to become involved in new, possibly unacceptable activities[Footnote 5].

7. Applicants with broad objects will be advised at the time of registration to notify the Directorate if, in the future, they wish to undertake activities not included in the original application. If after registration, an applicant wishes to modify its activities, it can notify the Directorate by providing a revised statement of activities, without necessarily modifying its objects.

References

• Registering a Charity for Income Tax Purposes, T4063.

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Footnotes

[Footnote 1]

The "objects" are also sometimes referred to as the "goals", "purpose" or "mandate" of the organization.

[Footnote 2]

The two excerpts of the Income Tax Act governing this policy are:

subsection 149.1(1): registered charitable foundations must be "constituted and operated exclusively for charitable purposes"; and,

subsection 149.1(1): requires that registered charitable organizations have "all (their) resources devoted to charitable activities."

[Footnote 3]

Note that political objects are not considered charitable, nor are objects that are worded so broadly that they would allow the pursuit of political objects.

[Footnote 4]

The practice of philanthropy has been recognized by the courts to encompass activities somewhat broader than the field of charity.

[Footnote 5]

For example, "through the funding of qualified donees and through such other means as the Board of Directors may determine from time to time".