Canada: The 4th Head of Charity: What "Other Purposes Beneficial to the Community" Means in Canada

Last Updated: March 1 2011
Article by Nick G. Pasquino

Most Read Contributor in Canada, December 2018


When an organization seeks charitable status and is refused by the Canada Revenue Agency (CRA), the organization may challenge the CRA's decision in court. Our courts, therefore, ultimately decide the legal meaning of charity.

There are three clearly enumerated categories or "heads" of charity: the relief of poverty, the advancement of education, and the advancement of religion. There is also a fourth head of charity – "other purposes beneficial to the community not falling in the other categories" – which is effectively a residual category that provides for purposes not falling within the first three heads.

The Canadian judiciary has taken a conservative approach to interpreting the fourth head of charity. The Supreme Court of Canada in a recent case held that the appropriate place to effect a wholesale modernization of charity law is the Parliament of Canada, so courts will resist the expansion of the fourth head.


Judges apply a complex test to analyze whether a purpose is charitable under the fourth head.

Courts begin by considering whether the proposed purposes are an "objectively measurable and socially useful benefit to the public." In other words: does the public as a whole, or a significant segment of the public, benefit from the proposed purposes or is the purpose to convey some sort of private advantage?

The court, however, does not end the analysis with whether there is a public benefit, as the law must view a purpose as charitable. Factors a court will consider in determining if the law regards a purpose as charitable include:

  1. whether the purposes were previously held to be for a public benefit which the law regards as charitable;
  2. the scheme of the Income Tax Act (Canada);
  3. whether an applicant is seeking an incremental change or a broad reform;
  4. whether the proposed purposes are vague; and
  5. whether the proposed purposes are exclusively charitable.

Prior court decisions recognizing charitable purposes are therefore helpful to applicants seeking an expansion of the meaning of charity. Below are some of the purposes which have been recognized by Canadian courts as charitable under the fourth head:

  1. Public works. The provision of internet services in a local community was charitable as it was analogous to the following existing charitable purposes set out in the Preamble: "to repair bridges, ports, havens, causeways, seabanks and highways".
  2. The benefit of a locality or the country. An organization which developed programs for native people in a province has been considered charitable as it was analogous "to the aid or ease of any poor inhabitants concerning payments of fifteens and other taxes" which was previously set out in the Preamble.
  3. Health and medicine. A health clinic was held to be charitable as it was analogous to the following existing charitable purposes set out in the Preamble: "the relief of impotent people and the maintenance of sick and maimed soldiers and mariners".

It is also useful for applicants to understand some proposed purposes which were not recognized as charitable:

  1. Sports. Promotion of amateur athletics is not charitable. The court held that "21% of all non-profit organizations in Canada are sports and recreation organizations, and the recognition of these organizations could have a significant impact on the income tax system."
  2. Politics. Courts have not recognized political purposes as charitable. Organizations whose purposes are to "sway public opinion on controversial social issues" or advocate change in law are political and therefore not charitable.
  3. Not Having Exclusive Charitable Purposes / Conveying Private Advantage. An organization that provided assistance to immigrant women by educating them and finding employment for them in Canada was held not to be charitable because the objects of the organization, as written, were not exclusively charitable (the objects included political purposes and overbroad language). The court also questioned whether the benefits to the individual women would constitute a private advantage, which is contrary to the public benefit requirement of charity law.


While the courts have the final decision on what is charitable, the CRA issues policies summarizing how it will interpret the fourth head of charity. These policies have expanded the meaning of charity to include, for example, protecting the environment, assisting ethno-cultural communities, and promoting racial equality.


The scope of what is charitable under the fourth head is certainly expanding; however, courts have been cautious to only grow the fourth head of charity incrementally, allowing expansion when and where appropriate, but firmly denying it in other circumstances.

As a result, organizations whose proposed purposes do not fit squarely into the three enumerated heads, the existing case law, or CRA's policies on what is charitable under the fourth head of charity should strongly consider speaking with counsel familiar with charity law issues to understand the risks involved and assist with drafting unambiguous, exclusively charitable objects that will satisfy the legal test for determining what is charitable at law in Canada.

About BLG

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Borden Ladner Gervais LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Borden Ladner Gervais LLP
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions