Every year Canadian registered charities must file the T3010 Registered Charity Information Return. The T3010 is due six months after the charity’s year-end. Failure to file the T3010 within a few months of that date will result in a charity being deregistered and losing its charitable status, and consequently also losing its receipting privileges. It is important that Directors record the date on which their returns are due and ensure that the address the CRA has on file is current. Otherwise, CRA reminder notices may never arrive and a charity may be deregistered without any notification. An unfortunate part of our work is helping charities that have been de-registered for "failure to file" with the long and sometimes arduous process of re-registration. Every year there are about 600 charities who fail to file.
Charities must also make sure that they file the correct form and all necessary schedules and financial statements must be also be filed. The 2012 Federal Budget gave CRA the power to suspend charity receipting for filing incomplete T3010 forms.
The T3010 is an important transparency tool for Canadian registered charities. Unfortunately for some charities completing the T3010 is an afterthought done a few days before the filing deadline by a bookkeeper or junior finance staff. From a risk management point of view, this is risky as the T3010 is one of the main tools CRA uses to decide which charities should be audited. Furthermore, many funders and donors utilize the T3010. Simple mistakes on the T3010 can result in your charity being flagged for audit by CRA or a funder simply declining to provide a grant.
Failure to accurately complete the T3010 has resulted in huge headaches for some organizations. There are especially sensitive issues on the T3010 such as fundraising costs/practices, compensation and political activities which have caused tremendous media attention.
We assist charities in their transparency needs with:
- review of draft T3010 and schedules before filing;
- establishing policies and procedures to increase the likelihood of accurate filings;
- balancing privacy with transparency;
- understanding how information provided on the T3010 will be used by different stakeholders;
- educational programs to help charities understand the complexity of this form and how it may be used by the public.
We are not accountants and don't prepare T3010 forms. We do however frequently review them and assist accountants and others in understanding the requirements of the form. If you wish to retain our law firm to review your charity's T3010 then please contact us.