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Do You Know Who Your Directors and Managers Are? The Often Overlooked Risk to Charities



by Michelle S. Thériault
McLennan Ross LLP - Yellowknife Office

December 17, 2013

Previously published on Winter 2013

As with any federal budget, the 2011 budget contained provisions that captured the attention of media and public alike. The changes to the governance of charities through amendments to the Income Tax Act (the “ITA”) were not among such provisions. Consequently, some very significant matters, which create a real risk to the livelihoods of charities, went largely unnoticed. Effectively, the new provisions, which came into force in 2012, render certain individuals ineligible to sit on Boards of Directors of registered charities or to be employed in senior capacities within registered charities. Should a charity allow “ineligible individuals” to act in such capacities, the charity will risk refusal or revocation of charitable status or suspension of the charity’s authority to issue charitable receipts. As such, prudent charities are well advised to become aware of these provisions and their implications, and to develop a process in order to minimize this new risk.


 

The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.
 

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Michelle S. Thériault
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Corporate Law
 
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