Asking for permission to accumulate property (funds)

Registered charities are subject to an annual spending requirement (disbursement quota). With permission, a registered charity may temporarily accumulate funds for a major expenditure, such as buying a building or costly piece of equipment, without incurring a spending shortfall. The amount approved for accumulation, and the income earned on the amount, is excluded from the charity’s annual spending requirement.

A registered charity can request permission to accumulate property for a specified purpose that is particular and not general in nature. For example, a public foundation may request permission to accumulate property to transfer funds to a hospital at a later date for the purpose of building a hospital wing.

To ask for permission

Send a letter with all of the following information:

  • the specific purpose for which the funds will be used
  • the amount required
  • the length of time needed to accumulate the funds (minimum 3 years and maximum 10 years)
  • the signature of a director/trustee or other authorized representative of the charity
  • the name and the registration number of the charity
  • the effective date (starting date)

Mail or fax the letter to:

Charities Directorate
Canada Revenue Agency
Ottawa ON  K1A 0L5

Fax: 613-954-8037

This letter is considered public information. The Canada Revenue Agency may provide this information to any person making a request.


If approved, the charity will receive a letter confirming the amount that can be accumulated, the specific purpose for which it was granted and the number of years for which the accumulation can continue.

The funds accumulated for a fiscal period, including any income earned on the accumulated amount, should be reported on line 5500 of the T3010 return. Accumulated funds spent for a fiscal period should be reported on line 5510.

Unused accumulated amount

If a charity does not spend the entire accumulated amount before the end of the agreed time period, or if circumstances change and the accumulation must be abandoned, the charity must treat the unused accumulation amount as a tax-receipted gift in the final year of the accumulation period. This means that 80% of the remaining accumulated amount will be added to the charity's disbursement quota in the following year. The amount deemed to be a tax-receipted gift for the fiscal period should be reported on line 5520.

If the charity needs more time to accumulate funds or wants to change the approved amount, it must apply in writing to the Charities Directorate.


  • Income Tax Act, R.S.C. 1985 (5th supp.) c. 1, ss. 149.1(8)
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