Does the Canada Revenue Agency (CRA) consider fundraising by a Community or other foundation to be a charitable activity or a charitable purpose?

Many of our clients, including those at a recent workshop, ask for clarification of the Canada Revenue Agency’s (CRA) administrative guidance on fundraising as it applies to Community and other foundations.

In their summary fundraising guidance document “CG-013 Fundraising by Registered Charities”, the CRA indicates that it does not consider fundraising to be a charitable activity or charitable purpose.  What they do say is that they do not consider seeking grants, gifts or other funding from other charities or governments to be fundraising.


However, soliciting endowment funds from individuals is one of the primary purposes of many community foundations.  Board members and staff often spend a significant amount of time searching for and soliciting private endowments from individuals.


So, does that put them off-side the CRA’s fundraising policies? 


According to the CRA’s answer to question #13 in the appendix of CG-013 Fundraising by Registered Charities, it will generally not consider a public foundation to be offside if they meet certain conditions.  We quote the question and their response below, for your reference.


Q.13 Our public foundation’s staff members spend the vast majority of their time planning, carrying out, and evaluating fundraising activities to raise money to fund other registered charities as efficiently as we possibly can. Does this mean our foundation has fundraising as a purpose?


A.13 No. It is true that the staff members of a public foundation may spend most of their time carrying out fundraising activities. However, under the Income Tax Act, a public foundation is constituted and operated primarily to fund qualified donees, which includes other registered charities. Creating and maintaining a fund or funds and disbursing monies to qualified donees are usually a public foundation’s primary activities.


Assuming a public foundation meets all other requirements of the Income Tax Act, the CRA will consider it to be constituted and operating primarily to fund qualified donees, and not for the collateral non-charitable purpose of fundraising, so long as:

  • Funds disbursed to qualified donees typically exceed expenses related to fundraising, including compensation of staff; and
  • The foundation spends no more on fundraising than is required.


If these criteria are met, and the fundraising activities do not deliver a more than incidental private benefit, and are not illegal, contrary to public policy, or deceptive, fundraising by a public foundation will generally be acceptable.



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