An organization is considered a charity if it has been granted a charitable registration number based on its charitable mandate, objects and activities. There are three forms of  registered charities: charitable organizations, public foundations and private foundations.
To qualify for or to maintain charitable registration under the Income Tax Act, a charity must be constituted
and operated exclusively for charitable purposes and activities. This means that the funds received by a
charity can only be used to support activities outlined in its charitable mandate. A charity can do this either
through spending the funds directly on charitable activities or partnering with a non-charity to carry out the
charitable activities.

Benefits of Charity and Non-Charity

Partnership is not the answer to every working arrangement, but may be an effective strategy for
community benefit in some contexts, such as:
  • • Grassroots community development projects
  • • Pilot projects and prototypes
  • •Emerging groups gaining experience

Benefits to the Community

  • Access to innovative programming
  • Enhanced service coordination through collaborations
  • Opportunity for more people to participate in the charitable sector

Benefits to Charities

  1. Enhanced capacity to fulfill charitable mandate
  2. New opportunity to practice community leadership
  3. New opportunity to provide mentorship, to share expertise and services
  4. Increased capacity to serve marginalized clients or to use emerging practices
  5. Additional learning and best practices through collaboration
  6. New opportunity to facilitate social innovation in the charitable sector
  7. Additional relationships and networks through the non-charity’s networks

Benefits to Non-Charities

  1. Access to charitable funding
  2. Access to administrative support (i.e., accounting, human resources, office services)
  3. Access to mentorship and expertise
  4. Exemption from income tax by falling under the tax exemption status of a charity
  5. Access to donations in support of the project if the charity is willing to provide tax receipts
  6. Ability to focus on work because some administrative tasks are done by the charity
  7. Opportunity to build credibility as an emergent group
  8. Additional relationships through the charity’s network

Benefits to Funders

  1. Opportunity to fund a wider range of initiatives focused on community benefit
  2. Opportunity to support new and innovative organizations or collaborations, or smaller community-based agencies
  3. High quality proposals, projects and evaluations
  4. Documented evidence of the parameters of charity and non-charity partnerships through increased development of partnership agreements.

Benefits to the Charitable Sector

  1. Support for an emergent group with innovative approaches and/or authentic connections to underserved communities
  2. Support for a collaboration that achieves what individual organizations cannot accomplish on their own.
  3. Accelerated opportunities for innovation to solve unmet societal needs
  4. Minimization of unnecessary duplication of services
  5. More programs, perhaps at reduced administrative cost due to collaboration
  6. The ability to quickly respond to an immediate need through targeted projects without necessitating the development of a charity.