The Budget proposes to provide support to affordable housing
providers by eliminating mortgage prepayment penalties on
long-term, non-renewable loans with the Canada Mortgage and Housing
Corporation (CMHC). This measure is intended to enable social
housing providers to access private financing at more favourable
interest rates, thereby freeing up capital for needed repairs and
to improve the quality of affordable housing units. It
responds to an identified concern that many co-operative and
non-profit housing providers are currently holding long-term,
non-renewable loans with CMHC at high interest rates.
This measure will be introduced in 2016. Entities that
provide social housing and that are currently holding high interest
loans with CMHC may wish to investigate refinancing options made
possible by this change.
The Budget also contains an announcement of new money for social
housing, some of which is to be delivered by the non-profit
Expanding Use of Business Numbers
The Budget announces that the government proposes to simplify
the federal business number registration regime. Currently,
organizations (including registered charities and non-profit
organizations) may need to apply for multiple business numbers with
different federal departments (e.g., CRA, Ministry of Labour,
ESDC). The Budget proposes the implementation of a common
business number that would apply across multiple federal
programs. This is designed to reduce paperwork and simplify
the process of interacting with government.
While this measure appears designed primarily with businesses in
mind, it may also be valuable to charities and non-profit
organizations that interact with multiple federal agencies.
The Budget noted recent announcements related to the reduction
of credit and debit card fees, as well as the introduction of an
enhanced Code of Conduct for the Credit and Debit Card Industry in
Canada. The reduction of the average effective interchange
rate to 1.5% for the next five years represents a nearly 10%
reduction in fees. The enhanced Code of Conduct provides for
new fee disclosure, dispute resolution mechanism, and branding
Charities that receive donations or otherwise accept payments by
credit and debit cards will benefit from these measures through a
reduction in fees as well as more flexibility and options in
dealing with credit and debit care providers. The Budget
noted that the government is currently consulting on the oversight
of retail payment systems to support competitive and innovative
ways to meet the payment needs of Canadians while ensuring that the
payment system remains safe.
The Budget contains a variety of specific funding announcements
for advanced research, some of which will flow to hospitals and
universities. "Economic Action Plan 2015 proposes to
provide more than $1.5 billion over five years to advance the
renewed science, technology and innovation strategy's
objectives, including long-term sustained advanced research support
through the Canada Foundation for Innovation and the federal
The Budget announces changes to for-profit corporate law
designed to improve gender diversity on boards and make other
transparency related improvements. The announcement, which is
not specific, states that "Amendments to related statutes
governing cooperatives and not-for-profit corporations will also be
introduced to ensure continued alignment among federal laws."
While gender diversity is clearly desirable in the non-profit world
as elsewhere, it will be interesting to see how gender diversity
(on a "comply or explain" basis) will be promoted as a
matter of corporate law in the non-profit world.
International Development Finance
The Budget announces a new development finance initiative
designed to encourage private sector investments in low and medium
income jurisdictions where the federal government (through Canadian
charities, we assume) is already providing development
assistance. It is possible that some Canadian charities will
be able to invest in the for-profit sector in a way that will
engage with this new program. As well, the new program gives
Canadian development charities an opportunity to consider
cooperation with Canadian businesses investing in the developing
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.
While most are well aware that the sale of a business is generally a complex process, even sophisticated business owners are surprised by just how much cost and effort is required to complete the sale.
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).