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Participating in Federal Public Policy: A Guide for the Voluntary Sector
What's in a name: voluntary, charity or non-profit?The first task in determining your organization's permitted level of involvement in political activity is sorting out the terminology. Although often used interchangeably, the terms "registered charity" and "non-profit organization" are defined differently by the Income Tax Act. "Voluntary organizations" and "voluntary sector," however, are used to describe the collective of charities and non-profit organizations.
The term "voluntary organizations" encompasses both charities and non-profit organizations. It includes any organization that enriches the community through its work. It includes recreational associations, service clubs, local community associations, advocacy groups and community development organizations among others. Although "voluntary" implies "volunteer," many voluntary organizations rely on paid staff to carry out their programs and services. All voluntary organizations, however, rely on volunteers on their board of directors for their governance.
Within the category of voluntary organizations, there are two categories that can be registered at CCRA: 1) registered charities and 2) non-profit organizations. Many groups (typically smaller or loosely organized ones) are neither.
"Registered charity" refers specifically to organizations registered under the Income Tax Act as meeting a strict set of criteria, which exempts them from paying income taxes and permits them to provide receipts for donations that can be claimed as tax credits. CCRA provides a definition of charitable purposes as well as information on how to register as a charity at http://www.ccra-adrc.gc.ca/tax/charities.menu-e.htm.
"Non-profit organizations" enjoy special tax exemptions that they gain by fulfilling the requirements of the Income Tax Act. Although they do not pay income tax (except on their investment income), non-profit organizations are not entitled to issue tax credits to those who contribute financially to their work. Information on how to register as a non-profit organization can be found at http://www.ccra-adrc.gc.ca/E/pub/tp/it496r/it496r-e.html.
The seemingly subtle differences between non-profit organizations and charities can make all the difference when it comes to the next topic - political activity.
A Note on Terminology
Government and voluntary sector stakeholders often describe the policy development process from different perspectives. Government often thinks of the entire process, from beginning to end, as policy development and the non-government people who do it as practicing "government relations." The voluntary sector engages in policy dialogue because it is advocating for changes or improvements for a part of society and one of the means to achieve such change is through new policy or law.
Advocacy is a topic of considerable discussion; its exact conduct, as well as the amount that can be done by charities, is currently being reviewed. (See the material developed by the VSI Working Group on Advocacy at http://www.vsi-isbc.org/eng/products/reports.cfm and IMPACS at http://www.impacs.org.)
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|Last Updated: 2019-11-21|