GST/HST and Fundraising Activities

How NPOs manage their operating budgets and their compliance with the GST/HST legislation

Accounting in Canada

Charities and other not-for-profit organizations (NPO’s) rely on fundraising to generate significant dollars towards their annual operating budgets.  Often, the application of GST/HST to these events is overlooked or improperly executed.  Risks involve not collecting GST/HST on taxable revenue sources and/or over claiming input tax credits (ITC’s) for GST/HST paid on expenses related to tax-exempt fundraising activities.

Fundraising could include admissions to events like concerts, dinners or golf tournaments as well as the sale of goods, like chocolate bars, or rain barrels.  Determining whether you should be collecting GST/HST on your revenues depends first and foremost on whether you are a registered charity.  GST/HST legislation provides a broader range of exemptions for fund raising events carried on by a charity than for other NPO’s.

A charity hosting a golf tournament, for example, would not have to charge GST/HST on the admission as long as the charity is able to issue…

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