Directors' liability

If you are a member of the board of directors of an NPO that is a corporation, it is important to ensure that your NPO meets its fiscal obligations.

The NPO must

• make source deductions and remit the amounts to Revenu Québec;
• file the required returns;
• collect and remit the QST and GST, where applicable. (The NPO must also pay GST and QST on the property or services it purchases.)

If the NPO does not meet these obligations, you (as a director) are liable for any duties payable by the NPO, as well as for the applicable interest and penalties, unless

• you acted with reasonable care, diligence and skill under the circumstances;
• you could not, under the circumstances, have been aware of the NPO's failure to meet these obligations; or
• you ceased to be a director at least two years before the NPO's failure to meet its obligations.

The Act respecting the Ministère du Revenu makes no distinction between types of directors. Furthermore, the fact that a director reduces his or her involvement in the corporation's affairs does not necessarily relieve the director of any liability with regard to the corporation.