2014-0560121E5 149(1)(c) exemption & qualified donee registration

Principal Issues: Whether an organization approved for registration as a qualified donee as a public body performing a function of government by the Charities Directorate requires a separate ruling to claim tax exemption under 149(1)(c).

Position: No, unless facts change.

Reasons: It has been determined that the organization is a public body performing a function of government therefore no additional ruling is required.

Author: Meers, Rob
Section: 149(1)(c); 149.1(1)

XXXXXXXXXX
                                                                                                                                                   2014-056012
                                                                                                                                                   R. Meers
                                                                                                                                                   (613) 957-2100

February 6, 2015

Dear XXXXXXXXXX:

Re: 149(1)(c) exemption and qualified donee registration 

This is in response to your e-mail dated December 2, 2014, inquiring as to whether your client (the “First Nation”) is exempt from tax under Part I of the Income Tax Act (the “Act”). The First Nation had received confirmation from the Charities Directorate that its application for registration as a qualified donee had been approved as the Charities Directorate had determined that the First Nation is a public body performing a function of government in Canada for the purposes of paragraph 149(1)(c) of the Act. You want to know if the First Nation requires a separate ruling from us as to whether it is exempt from tax under Part I of the Act.

Since it has been determined that the First Nation is, and as long as it continues to be, a public body performing a function of government in Canada within the meaning of paragraph 149(1)(c) of the Act, the First Nation will be exempt from tax under Part I of the Act. There is no requirement to obtain a separate ruling from the Income Tax Rulings Directorate. Whether the First Nation continues to be a public body performing a function of government is a question of fact. Should circumstances change and the First Nation wishes to have its status as a public body performing a function of government reviewed, a separate ruling may be requested at that time.

We trust that these comments will be of assistance.

Yours truly,

Roger Filion, CPA, CA
Manager
Non-Profit Organizations and Aboriginal Issues
Business and Employment Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch

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