Psst!--listen to this, I want you to understand my position.

• Author: Hunter, Laird
• Position: Not-for-profit law

At long last the CCRA has released its policy on political activities [1] CPS-022 addressing the Charity Directorate's administrative position on the involvement of charities in political activity. This policy replaces Information Circular 87-1 Registered Charities--Ancillary and Incidental Political Activities. Its stated purpose is to provide information for registered charities on political activities and the allowable limits under the Income Tax Act (ITA). In the Policy's own words:

It also provides a framework that explains how [the Charities Directorate] distinguishes between political and charitable activities. In addition, it seeks to clarify the extent to which charities can usefully contribute to the development of public policy under the existing law.

An explanatory outline that charities can use to guide their work is a long-standing need. As well, many charities struggle to know how they can make a useful contribution to the development of public policy--making known the knowledge these charities have gained about how government policies affect people's lives.

The Outline

The Policy statement repeats the important distinction between purposes and activities; purposes being the goal towards which the charity's efforts are directed while activities, in the words of a famous English judge, are the purposes presently instituted. In making this distinction CPS-022 sets down the following rules.

Under the ITA and common law, an organization established for a political purpose cannot be a charity. The courts have determined political purposes to be those that seek to

* further the interests of a particular political party; or support a political party or candidate for public office; or

* retain, oppose, or change the law, policy, or decision of any level of government in Canada or a foreign country.

But what about the activities of a charity properly established for an otherwise charitable purpose? The Policy is at least clear on the requirement:

Although an organization established for a political purpose cannot be registered as a charity, a registered charity may take part in some political activities as a way of furthering its charitable purpose(s). However, charities do not have complete freedom to support any cause they like.

What are the limits on that freedom? For the purposes of the Policy, a charity's activities are divided into three separate types:

i. prohibited activities ii. political activities iii. charitable activities

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