CRA has information on its website about how Canadian registered charities must act within their legal objects and how those objects must be legally and exclusively charitable. Objects of a non-profit corporation are usually set out in the corporation’s constating documents such as letters patent or supplementary letters patent in the Ontario system.
This article discusses the importance of objects and why it is important for Ontario non-profit corporations that are registered charities to pay particular attention to their objects.
In this article, references to “objects” and “purposes” are used interchangeably.
What has changed?
The Ontario Not-for-Profit Corporations Act, 2010 (“ONCA”) came into force on October 19, 2021. ONCA applies to over 50,000 Ontario non-share capital corporations of which perhaps 15,000 – 20,000 are registered charities. Dealing with ONCA changes will be more difficult for non-profits that are registered charities than for non-profits that are not charities.
Non-profits that were governed by Part III of the Ontario Corporations Act (the “OCA”) before ONCA came into force will have a three-year transition period to bring their governing documents into conformity with ONCA.
If an Ontario non-profit that is a registered charity is making changes to its governing documents to align them with ONCA then it is a good idea to also consider what should be included in the objects and to obtain the necessary approvals from CRA.
Many Ontario non-profits that are registered charities have objects that may no longer be appropriate. The objects may be inappropriate because they are “broad and vague” or they are too narrow considering the charitable activities that the organization wishes to carry out or is carrying out. In both instances the objects are problematic from a legal point of view.
Here is the full article Objects of many Ontario non-profits that are registered charities are sometimes not charitable or appropriate.