Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues:
Whether proposed foundation would qualify as a non profit organization under paragraph 149(1)(l) of the Act.
Position TAKEN:
Information submitted insufficient to express an opinion.
Reasons FOR POSITION TAKEN:
Incorporating documents submitted do not provide any indication of the activities that will be carried on.
ADM'S OFFICE (2) ADM 950208
RETURN TO 15TH FLOOR, ALBION TOWERS
AUTHOR
SUBJECT OR CORPORATE FILE
May 8, 1995
XXXXXXXXXX
Dear XXXXXXXXXX:
I am writing in reply to your letter of February 3, 1995, in which you made representations on behalf of XXXXXXXXXX as to whether the proposed XXXXXXXXXX would qualify as a non-profit organization within the meaning of paragraph 149(1)(l) of the Income Tax Act (the "Act").
To qualify as a non-profit organization under paragraph 149(1)(l) of the Act, an association must be both organized and operated exclusively for social welfare, civic improvement, pleasure, recreation, or for any other purpose except profit. An association may also be organized and operated exclusively for any combination of these purposes.
To determine the purpose for which an association was organized, the Department normally looks to the instruments by which it was created. The draft "Application for Incorporation..." states that the objects of the Corporation are:
XXXXXXXXXX
the incorporating draft documents do not provide any indication of the activities that will be carried on. Therefore, I am unable to comment as to whether the proposed corporation would be considered to be organized exclusively for civic improvement. If this information is available in other incorporating instruments, we would be pleased to review any such documents you may wish to refer to us.
The determination of whether an association was operated exclusively for, and in accordance with, its non-profit purposes in a particular taxation year must be based on the facts of each case. Such a determination can be made only at the end of the year by reviewing all of the association's activities for the year and cannot be made in advance of a particular year.
I trust that these comments will be of assistance.
Yours sincerely,
Denis Lefebvre
Interim Assistant Deputy Minister
Policy and Legislation Branch
Wm. P. Guglich
957-2102
950418
April 27, 1995
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