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Charity and Not-For-Profit

'Tis the season to research your charity

With an estimated 60 per cent of Canadians expected to give to various charities this holiday season, Toronto charity/not-for-profit lawyer Taras Kulish says it’s crucial to “know your charity" before donating.

A recent report from Imagine Canada estimates that Canadians will donate $5 billion by the end of the year.

“This annual tide of generosity is essential to thousands of charities and the communities they serve,” the report states. “According to Statistics Canada, Canadians give just under $13 billion annually to charities and non-profits, meaning that approximately 40 per cent of all donations take place in the last six weeks of the year.”

Kulish, a senior associate with Steinberg Title Hope & Israel LLP, encourages people to do their research before donating.

“It’s key to know your charity,” he tells AdvocateDaily.com. “You should drill down and do your research. If you want to donate at this time of year, go to the charities that you trust and that you’ve researched.”

He points to a recent example involving the Humane Society of Canada for the Protection of Animals and the Environment —  which operates as the Humane Society of Canada — and its continued fight with the Canada Revenue Agency (CRA) to keep its tax-free status.

Despite the similarity in names, the Humane Society of Canada does not act for the 52 humane societies and other animal welfare charities across Canada which are in fact members of the Canadian Federation of Humane Societies.

The similar names could create confusion among donors, Kulish says.

He adds that donors should be cautious when it comes to crowdfunding campaigns. There are a multitude of crowdfunding platforms online and no shortage of campaigns donors could contribute to.

“Crowdfunding is very buzzworthy right now,” Kulish says. “It can be easy to get caught up in a campaign but unless the crowdfunding is run through a registered charity, there are no real controls. You don't really know whether the money raised is going to be used for the specific purpose that is communicated in the campaign.”

That’s not to say all crowdfunding should be avoided, he says, but don’t toss your common sense out the window.

“Make sure the crowdfunding campaign is tied to a registered Canadian charity. This way you can get your donation into safe hands, you have assurances that there are controls put in place by the CRA to protect you and you will receive a charitable receipt for tax purposes.”

For example, Kulish points to a charity he volunteers for HOPE Worldwide of Canada, which accepts donations for internally displaced people in Ukraine through an online crowdfunding platform called Tilt.

“While Tilt is a crowdfunding platform, Hope Worldwide is behind the campaign and will issue tax receipts. Updates as to how the donations were used are available on the website."

 

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