Earlier this year, CRA released an updated Guidance (CG-022) on Housing and Charitable
Registration. The new Guidance replaces CRA's former policy
statement on the subject, and sets out CRA's position on the
tax rules surrounding the provision of housing that relieves
poverty or that includes specially adapted facilities to assist
individuals overcome difficulties associated with disabilities or
aging. Charities that work in this space should review this new
With respect to housing that relieves poverty, CRA confirms that
the provision of comfortable, modest housing to poor beneficiaries
at less than fair market value rates can relieve poverty. It is
also acceptable to provide ancillary amenities and support
services, such as meals, basic utilities, clothing, furniture or
counselling. CRA confirms that organizations must assess all
prospective beneficiaries to ensure that they qualify as being in
financial need. CRA expects that charities will establish policies
around how eligibility of individuals will be determined, which
should include an assessment of their income, assets and
liabilities. CRA indicates that it also expects a charity to have
policies confirming how they will deal with individuals who no
CRA also comments on the provision of housing that includes
special services for the disabled or the elderly. CRA confirms that
the provision of comfortable and modest accommodation for such
beneficiaries can qualify as charitable. Unlike housing that
relieves poverty, however, housing that includes specially adapted
facilities for the disabled or aged does not need to be provided at
less than fair market value to qualify as charitable. It is thus
not necessary for the organization to assess the financial
circumstances of potential beneficiaries, provided that they are
either disabled or elderly. CRA does note that charities must
ensure that the type of housing helps residents manage their
Organizations providing housing with specialized services for
the elderly should also consult CRA policy on Charitable Relief of
the Aged (CPS-002).
The updated Guidance also addresses the information that must be
provided when registering a charity that will provide charitable
housing. Among other things, organizations will be required to
specify the criteria and process used to select beneficiaries,
determine rental rates and ensure that only eligible beneficiaries
receive charitable benefits. If tenancy in a facility includes both
charitable beneficiaries as well as non-charitable tenants, the
organization must supply the proportion of each and confirm that
non-charitable tenants pay market rent. The organization must also
confirm the goods, services and amenities that are available to
both types of tenant.
These can also be expected to be the issues which the Charities
Directorate will review when conducting an audit of a registered
charity that provides charitable housing services.
Charities and prospective charities that provide housing
services should review their policies and practices in light of
this new Guidance.
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 Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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).