Accumulation of property by a public foundation

Policy commentary

Release date
May 25, 1992 (Revised November 23, 2005)

Reference number
CPC-005

Subject

Accumulation of property - Whether a public foundation can accumulate property to make a gift to a related charitable organization at a later date, for a specified purpose

Purpose

To clarify the Directorate's policy regarding the accumulation of property.

Commentary

Under subsection 149.1(8) of the Income Tax Act, a registered charity can request permission to accumulate property for a particular purpose. This provision allows a charity to postpone the disbursement of funds with respect to a specified purpose, that is particular and not general in nature, rather than excuse a charity from meeting its disbursement quota. For example, where a hospital foundation requests permission to accumulate property to transfer the funds to the hospital at a later date for the purpose of building a hospital wing. Therefore, a public foundation can accumulate property to make a gift for this type of purpose or for a specified purpose to a related charitable organization at a later date.

References

• Income Tax Act, R.S.C. 1985 (5^th supp.) c. 1, ss. 149.1(8)

Date modified:

2005-11-30