CANADIAN NATIONAL
BAPTIST CONVENTION
Resources
Charitable Status Resource
These guidelines are for CNBC churches and church plants pursuing charitable status in Canada (becoming a registered charity). They provide general information, best-practice recommendations and step-by-step instructions for the process. CNBC does its best to ensure accurate and up-to-date information. The guidelines should not be interpreted as legal advice but treated as a reference.
What is a registered charity?
A registered charity refers to an organization, like a church, that has charitable status with the Canada Revenue Agency. It must be established and resident in Canada, operate for charitable purposes (Advancement of Religion) and devote its resources (funds, personnel, and property) to charitable activities.
Know The Process
When a church is ready and able to carry out its mission independently of a sending church or regional hub, the church can apply for charitable status. Note that churches will need to have certain admin, bookkeeping and, if applicable, payroll knowledge in place. Set your church up for charitable status by following these five steps:
Set your church up for legal establishment by creating a Constitution and Bylaws – the governing documents. When a church applies for charitable status, it must provide a complete and legible copy of its governing documents in English or French.
Constitution - A Constitution is a governing document that sets out the purpose of the organization as well as the main rules that guide how an organization works. It is generally short and concise. Once the CRA approves a Constitution as part of a registered charity, any future changes will need to go through the CRA.
A Constitution must contain at least the following requirements:
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Church name. The name should be distinguishable. A quick Google name search can help you see how specific you need to be. Instead of Grace Church, your church may need to add the area you are serving: Grace Church Vancouver North.
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Purposes of the church (see Step 2)
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A non-profit clause - a statement stating that your church will only operate without the purpose of gain. Sample statement: “XYZ church is not organized for profit. The property of this church is dedicated to religious purposes, and nothing of the net income or assets of XYZ church shall ever be used for the benefit of a leader or member of the organization, or any private individual.”
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Leadership structure - the organization of decision-making authority of the church leadership (CRA refers to them as directors or officers).
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Leadership replacement - a statement that explains how the church will replace its leadership (for example, annual election by members, appointment by existing leadership, etc.)
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Effective date of the Constitution.
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Signatures of at least three members of the church’s leadership.
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While we pray this statement is never needed, CNBC recommends including a dissolution clause, stating where the church’s assets will go after it ceases to exist (e.g. to a registered charity such as a church).
Bylaws set out the rules and regulations for the administration and management of the church. The procedures in the Bylaws are in line with the Constitution and form a part of the governing documents. Among other things, Bylaws often identify:
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Duties and responsibilities of the leadership team
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Fiscal year-end of the church
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Meeting procedures
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Membership requirements
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The process for hiring staff
Because individual provinces determine some of the rules charities need to follow, CNBC has asked churches and experts from all seven CNBC Regions to share best practices and, if applicable, share examples to be used as starting points for drafting Constitutions and Bylaws:
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Atlantic
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Quebec:
Quebec Council of Christian Charities (QCCC) and the phone number : 450-778-7177. https://cqoc.org/en/
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Ontario
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Manitoba
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Saskatchewan
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Alberta
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Westcoast
CRA requires applicants to provide the church’s purposes. Your purpose statement, which is part of your Constitution, must identify purposes that are exclusively charitable.
Understanding Purpose
Your church’s purposes contain the following information: WHAT does the church do, HOW does it plan to accomplish that, and WHO will benefit from the church's activities.
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WHAT: the CRA needs to be satisfied that your purposes fall under the Advancement of Religion charitable purpose category. Using words like “faith,” “worship,” “evangelism,” and “teaching” will contribute to CRA’s understanding.
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HOW: state the means used to accomplish the “what.” These will be the elements that need to be described with detailed plans under “Activities” (see step 3).
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WHO: generally, the beneficiaries of a church include the general public and those of the Christian faith.
Example of a purpose statement: “The purpose of XYZ-Church is to worship God, change lives through the Gospel of Jesus Christ and promote the development of faith [what]; through Bible-centered teaching and making Christ known through discipleship, missions and evangelism at home and abroad [how] and by ministering to the community in which we are located in [who].
The CRA has a guide on how to draft purposes for charitable registration.
In the application process, the description of your church’s activities is just as important as your purpose statement.
Understanding Activities
Activities are the detailed answers to the question of HOW your church will achieve its stated purposes. CRA asks for applicants to give detailed and real plans for its current and proposed activities and show that they accomplish its charitable purposes.”
Example of an activity description: Evangelism at home
XYZ Church is passionate about sharing the good news of Christ with as many people as possible in our local community. We aim to host three block parties a year (spring, summer and fall) in an effort to build relationships and bring the community together. Both XYZ staff and volunteers are enlisted to help with obtaining a street permit, providing food and snacks, organizing activities for both adults and children and maintaining supervision. The block parties will be advertised throughout the community and on Social Media. These events will be at no charge to the community and XYZ Church will cover all expenses. As we connect with our community, we build relationships, share the gospel and invite them to XYZ Church in order to come to faith and grow in faith.
In addition, XYZ Church will organize a one-week kids' camp every summer, which will be held at venue X. For five weekdays, any child from the community (ages X up to Y) is welcome to attend this camp from X am- X pm. We will charge X dollars per child to help with some cost recovery. XYZ Church staff and volunteers will offer Bible story time, teaching, sports and crafts activities. We encourage friendships, share the gospel and invite them and their parents to come to XYZ church so that they may come to know Christ.
Finally, small groups of XYZ Church members aim to go out into the community X times a year to engage in street evangelism and public outreach. Engaging in conversation, XYZ Church members will share the gospel and hand out gospel tracts, inviting them to church with the goal of doing life with them and introducing them to faith in Christ.
CRA has pointers and helpful information available for describing activities as part of the charitable registration process.
With your Constitution and Bylaws in place, the purposes identified, and detailed plans for activities described, you can start the application process for charitable status. Many churches complete the application on their own or with the support of people who have experience in completing such applications. Others seek legal advice from a charity lawyer to help their church apply for charity status.
The step-by-step process provided by CRA helps churches ensure the information on the application is complete. First, your church will need to register for a My Business Account. In the portal, click the link to apply for charitable status, and you will be directed to an online form: Application to Register a Charity under the Income Tax Act. The CRA provides detailed information on how to submit your application. At a minimum, have the following documents ready to upload:
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A copy of your Constitution and Bylaws.
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detailed and clear information about the purpose and activities of your church;
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a complete list of directors, trustees, or similar officials in leadership;
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a copy of budget information;
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and a copy of a financial statement if available;
When all questions have been answered and you have uploaded the required documents, you can submit your application. The government of Canada does not charge a filing fee for this. It is highly recommended to save the details of your application. Your application status can be tracked by logging into your My Business Account and selecting “View application status” under your RR account.
It is common for churches to be requested to provide further information and/or clarification by the CRA after submitting the application. Be sure to keep a copy of your application for your records, so you know how you have formulated answers on your initial application. If CRA needs additional information, they will contact you. Be ready to respond quickly and thoroughly, and with grace. If you fail to respond within the allotted time frame, CRA will close the file, and you will need to apply again.
Once your application is approved, CRA will send a "Notification of Registration," which will include information about registered charities and your Business Number. Your church will get a nine-digit Business Number, followed by a two-letter Program identifier (RR - for a registered charity), and the last four digits are a reference number. For example: 123456789 RR 0001
Please let the RML in your region know you received charitable status so they can celebrate with you!