Summary Policy

Date
September 3, 2003 (Revised September 13, 2005)

Reference Number
CSP - N01

Key Words
Non-qualified donee - Undue benefit - Sanctions

Policy Statement

Under the Income Tax Act, a registered charity that transfers resources to a non-qualified donee is liable to a penalty equal to 105% of the amount of the benefit. This penalty increases to 110% and the suspension of tax-receipting privileges for a repeat infraction within 5 years.

References

• Financial Penalties, CSP-F17.
• Qualified Donee, CSP - Q01.
• Sanctions, CSP-S17.
• Suspension, CSP-S18.
• Undue Benefits, CSP-U02.
• Non-Qualified Donee, CIL-1995-001, CIL-1998-011, CIL-1999-003, CIL-2000-018.
• Income Tax Act, R.S.C. 1985 (5^th supp.) c. 1, ss. 188.1(4) and (5).