Not-for-Profits vs. Registered Charities - Part 2


Regulatory differences between Charities and Not-for-Profits

Despite the similarities of Not-for-Profits and Charities, there are some critical differences in how they are regulated.

1. In contrast to charities, Not-for-Profits must not issue tax receipts for income tax purposes for donations.

2. Not-for-Profit organizations are not required to be registered under the Income Tax Act to qualify as such.

3. Not-for-Profits may distribute their remaining assets among their members upon dissolution (unless explicitly prohibited from doing so by their Articles of Incorporation, constating documents or bylaws). Registered Charities however, must distribute all their remaining assets to other registered charities.

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