CHARITIES: Ineligible Individuals Can Get Your Organization De-Registered

CHARITIES: Ineligible Individuals Can Get Your Organization De-Registered

CRA holds the authority to suspend receipting privileges and refuse or revoke the registration of a registered charitable organization when an “ineligible individual is a board member or controls or manages the organization”.

On March 17, 2016 CRA Guide CG-024, Ineligible Individuals, was updated. It provides 29 pages of description and implications of having ineligible individuals on boards and in management positions.

Generally, an individual is ineligible if he/she:

  • has been convictedof an offence:
  • related to financial dishonesty; or
  • relevant to the operation of the organization; or
  • was connectedto an organization whose registration was revoked for a serious breach of the requirements for registration. Relevant connections could include:
    • a director, trustee, officer, or like official;
    • an individual in a position of management or control; or
    • a promoter of a tax shelter, and participating in that tax shelter caused the revocation of an organization’s registration.

Individuals who manage a registered organization, directly or indirectly, include anyone who does one or more of the following:

  • performs managerial (rather than only operational) duties;
  • hires, disciplines and dismisses employees;
  • prepares budgets within the organization; or
  • varies staff assignments.

Individuals who have influence or the power to do one or more of the following would be considered to have control:

  • change the board of directors or reverse its decisions;
  • make alternative decisions concerning the actions of the organization;
  • directly or indirectly end the organization; or
  • appropriate the organization’s assets.


Action Item: Review your charity’s current leadership for possible ineligible individuals. Also consider adjusting recruitment and engagement processes to detect such individuals.



This publication is produced by Andrews & Co. as an information service to clients and friends of the firm, and is not intended to substitute for competent professional advice. No action should be initiated without consulting your professional advisors.

No Comments

Sorry, the comment form is closed at this time.