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Religions and social welfare

Religion and Registered Charities in Canada

Registered charities in Canada are regulated through the Income Tax Act. The Act describes registered charities as “charitable organizations, public foundations, or private foundations that are created and resident in Canada.” The primary purpose of charitable organizations is to deliver goods and services to the public, “while foundations have a primary mission to raise funds and then distribute these funds to charitable organizations” (Payne 2012, 7). Foundations are further classified into public or private depending on the proximity of donors to the foundation’s director and on the quantity of its donors. Charites are different from non-profit organisations in that the former operates solely for charitable purposes, although both must operate exclusively for motives other than making a profit.

A registered charity’s resources must be explicitly used for ‘charitable purposes’ as defined by common law, such as relief of poverty, advancement of education or other purposes which may benefit a community. Registered charities may also have as their key purpose the ‘advancement of religion’. These charities are usually places of worship or missionary organisations that work to “promote the spiritual teachings of a religious body and to maintain doctrines and spiritual observances on which those teachings are based” (Government of Canada 2002). Religious charities along with educational charities are reviewed by the Canadian Revenue Agency (CRA) to determine whether their activities benefit and are open to the public at large, or at least to a significant portion of the population.

Under the Income Tax Act, registered charities do not need to pay income tax, and must generally issue official donation receipts for income tax purposes. Registered religious charities may benefit from the same tax regulations and exemptions, including tax exemptions on property taxes, rebates to income taxes, government transfers, and tax deductions for clergy residences. In 2017, Canadian charities issued over 18 billion in donation receipts, 38 percent of which were issued by Canadian religious registered charities. Some registered charities are exempt from filling their annual return information under certain conditions, in particular if the charity was in existence before 31 December 1977, and if they have not received gifts directly or through other charities since that date.

The CRA was part of a 2019 court case involving the Church of Atheism of Central Canada. The Church of Atheism applied to the CRA to obtain status as a charitable organization that contributes to the ‘advancement of religion.’ The application was denied. The Church of Atheism brought their case to the Federal Court of Appeal, claiming in part that the rejection infringed upon their right to freedom of religion guaranteed under the Canadian Charter of Rights and Freedoms. The Court concluded that the Church of Atheism does not qualify as a religion, stating that it “did not demonstrate that its belief system is based on a particular and comprehensive system of doctrine and observances” (at para. 22). Therefore, the Minister of National Revenue was reasonable in denying the Church of Atheism charitable registration under the condition of ‘advancement of religion.’ The Court did state, however, that belief and reverence in a Supreme Being is not always necessary when considering the meaning of ‘religion.’ The Court further concluded that the Minister’s decision does not interfere in a substantial manner with the church members’ ability to practise their atheistic beliefs. Accordingly, the rejection of the Church of Atheism’s application did not violate their Charter right to religious freedom.

 Church of Atheism of Central Canada v. Canada (National Revenue), 2019 FCA 296.
 Government of Canada. 2002. “Religion: Summary policy”. Last updated October 25, 2002.
 Payne, A. Abigail. 2012. Changing Landscapes for Charities in Canada: Where Should We Go? The School of Public Policy Publications, 5 (34): 1-24.
 Sandra Dunham. 2019. ‘The Cost of Religion in Canada: Canadian Taxpayers Funding the Advancement of Religion.’ Center For Inquiry Canada, 1-12.

D 27 May 2021    ASarah Nour Bouali

CNRS Unistra Dres Gsrl

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