To qualify for registration as a charity, an organization must have purposes that are exclusively charitable and charitable activities that support those purposes. The purposes (also called objects) describe the aim or main intent of the organization. The activities describe how the organization will accomplish its purposes.
The term charitable is not defined in the Income Tax Act, so we consider common law (court decisions) to determine what is charitable.
The courts have identified four categories of charity:
An organization's purposes must fall within one or more of these categories to be considered for registration as a charity.
The following examples list what would generally be considered charitable under each category of charity. Note that these lists are not complete.
To relieve poverty in the charitable sense means to bring relief to the poor. The poor are those who lack the basic amenities available to the general population. For more information, go to CSP-P03, Poverty.
To advance education in the charitable sense involves the training of the mind, advancing the knowledge or abilities of the recipient, raising the artistic taste of the community, or improving a useful branch of human knowledge through research. For more information, go to CSP-E01, Education.
To advance religion in the charitable sense means to preach and advance the spiritual teachings of a religious faith, as well as to maintain the doctrines and spiritual observances on which those teachings are based. For more information, go to CSP-R06, Religion.
This category includes various purposes that do not fall within the other categories but which the courts have recognized as charitable. For more information, go to CSP-C10, Other purposes beneficial to the community.
For more information on, and examples of, acceptable charitable purposes, go to Model Objects.
Activities are an organization's programs or how it accomplishes its purposes. Charitable activities are activities carried out to fulfill a charitable purpose. Without a charitable purpose, an organization cannot have charitable activities.
To qualify for registration, an organization must show in its application that it devotes all of its resources (funds, personnel, and property) to charitable activities that directly further its charitable purposes. Therefore, it should explain, in detail, the specific activities it will undertake to achieve each of the formal purposes stated in its governing document(s) (its incorporation documents, constitution, trust document, or other establishing documents). For example, the purpose “to relieve poverty by operating a food bank for the benefit of the poor,” has to be accompanied by a statement of activities showing how the organization will accomplish this purpose.
For more information, go to Describing your activities.
To be registered as a charity, an organization's purposes and activities must also meet a public benefit test. To qualify under this test, an organization must show that:
An organization that wants to limit its beneficiaries unreasonably, or offer an unreasonable benefit to a group or individual, will not qualify for registration.
For more information, go to CPS-024, Guidelines for Registering a Charity: Meeting the Public Benefit Test.
Still not sure?
If your organization is still not sure if its purposes, activities, or public character will qualify it for registration as a charity, we will review draft governing documents, on a one-time basis, when submitted with a complete application. For more information, go to Application review process.