A State of Change – November 2018

Published on: Nov 26, 2018


In this issue of the newsletter, we share with you Deloitte’s approach to driving social impact. We are proud of our recently renewed corporate responsibility strategy and the additional ways we are now supporting our community. We also feature an article on important changes to rules on payments to directors of Ontario charities that came into effect on April 1, 2018. Lastly, we wanted to make you aware of a quick update on changes to the T3010 submission.

Driving social impact: tapping into skills-based volunteering

For the Junior Achievement (JA) Company Program students sitting in Deloitte’s Calgary office one spring evening, the subject of how to manage the books of their student-run company had posed a significant challenge. But they were there to learn. Months prior, their Deloitte volunteer advisor, Jennifer Tang, recognized that the students did not have the adequate accounting background to manage their financial statements, balance their books, and take the steps to ultimately liquidate their company.

And so, Jennifer and her fellow advisors used their professional skills to develop a workshop that would help young people better understand financial matters. “Liquidation training” was so well received that Jennifer and others now deliver it to all JA Company Program participants across Southern Alberta – reaching about 700 students annually.

Jennifer is a senior manager in Deloitte’s Audit & Assurance business and is part of a movement of professionals at the firm who take the initiative to volunteer their skills to generate social impact in partnership with Not-for-Profit organizations.

This collaborative approach is part of Deloitte Canada’s corporate responsibility strategy Tomorrow, Together, through which practitioners are empowered to lend their time and professional skills to break down barriers to education, employment and inclusion through skills-based volunteering and pro bono work. In 2017, Deloitte moved to embed community impact into its way of doing business and now promotes year-round volunteering, in addition to the firm’s long-standing Impact Day, and has established long-term partnerships with community organizations like JA to further effect positive change.

Deloitte’s recently released 2018 Corporate Responsibility Report outlines the shift in the firm’s strategy, moving the firm from a single ‘Impact Day’ focus, to one of ‘impact every day’ in the community.  Here’s a look at just some of the progress the firm has made as part of this shift:

  • 70% − the percentage of firm volunteering projects that use our professional skills, on Impact Day and year-round
  • 14,357 hours of pro bono work conducted by Deloitte people year round, a 1,782% increase over the previous year
  • Over 67,000 people in Canada positively influenced through education and skills-building initiatives (this measure represents total number of individuals directly affected through one-on-one skills–building and mentoring activities, and indirectly impacted through our capacity building support of community organizations)

The numbers speak to the importance of Deloitte’s Canadian Tomorrow, Together strategy, and how it goes hand in hand with a global social impact initiative called WorldClass. Across its worldwide network of member firms, Deloitte aims to prepare 50 million futures for a world of opportunity in an increasingly globalized and technology-driven economy. By 2030, Deloitte seeks to transform learning and enable individuals to access the skills they really need to meet future job demands.

The report also highlights Deloitte’s efforts to build an empowered workforce and a culture of inclusion, operate sustainably, and work ethically.

For Jennifer, tapping into her professional skills to deliver finance training not only helped to enhance student performance, fulfilling the Tomorrow, Together strategy to educate people and open the door to employment, but it also empowered her to grow her leadership capabilities and gain experience. What’s more, Jennifer says, is that it’s extremely rewarding to see the tangible result of her volunteer work and know that she’s made an impact that matters on the next generation of leaders.

Today, companies are increasingly making social impact a meaningful part of their business strategy and seek collaborators to tackle social challenges in order to create winning conditions for for-profit and non-profit sector organizations to build a brighter future. 

Changes to rules for payments to directors of Ontario charities

The Ontario Government amended Regulation 4/01, Section 2.1, Authorization to Pay, to the Charities Accounting Act (“the Regulation”) on April 1, 2018, to allow charitable corporations operating in Ontario to make certain payments to directors and connected persons without a court order in certain circumstances.

The old rule was that a director of a charity was prohibited from accepting any payment or personal benefits from the charity without a court order.

The Regulation provides a new framework for the board of directors to authorize certain payments if all requirements are met. The court order is still required if a payment is not authorized under the Regulation.

For the purposes of this Regulation, a charitable corporation is a not-for-profit, non-share corporation operating in Ontario that is a registered charity (“charity”). Non-incorporated charitable organizations cannot use this Regulation to pay their directors.

The purpose of this article is to provide a summary of the new rules under the Regulation.

Who can receive payments?

A charity operating in Ontario is authorized to make payments from its charitable property for goods, services or facilities to:

  • A director; or
  • A person connected to a director.

For the purposes of this Regulation, persons connected to a director are:

  1. A spouse, child, parent, grandparent or sibling of the director;
  2. The employer of the director or of the spouse, child, parent, grandparent or sibling of the director;
  3. A corporation with share capital, if, singly or jointly, the director or the spouse, child, parent, grandparent or sibling of the director beneficially owns, controls or has direction over more than 5% of the corporation’s shares;
  4. A corporation without share capital, if, singly or jointly, the director or the spouse, child, parent, grandparent or sibling of the director beneficially owns, controls or has direction over more than 20% of the outstanding voting membership interests of the corporation;
  5. A corporation with or without share capital for which the director or the spouse, child, parent, grandparent or sibling of the director acts as director or officer;
  6. A partnership in which the director or the spouse, child, parent, grandparent or sibling of the director is a partner, or in which a corporation described in paragraph 3, 4 or 5 is a partner.
  7. A partner in a partnership described above.

What payments are authorized?

The Regulation authorizes payments for goods, services and facilities provided to the charity by a director or a person connected to a director described above (e.g., the delivery of lecture, occasional professional services and consultation, a piece of research, rental of space, a contract to provide maintenance work).

The Regulation does not authorize any of the following payments:

  1. Remuneration or other direct or indirect payment for services provided by a director as a director or employee of the charity, in that capacity (directors of charities have a duty to act gratuitously);
  2. Direct or indirect payment for providing fundraising services or for selling goods or services for fundraising purposes;
  3. Direct or indirect payment made in connection to the purchase or sale of real property.

What conditions must be met for the payment to be authorized by the charity’s board of directors?

1. The payments must:
     a. Be made for the best interest of the charity;
     b. Be a reasonable amount for the charity to pay for the goods, services or facilities provided;
     c. Not result in the amount of the charity’s debts and liabilities exceeding the charitable property’s value, or render the charity insolvent; and
     d. Not exceed the maximum amount authorized by all of the directors.

2. Before a charity’s board of directors may authorize payment for goods, services or facilities:
     a. All directors (including the director receiving the payment) must agree in writing to a maximum amount that can be paid by the charity for the goods, services or facilities. If the goods, services or facilities are to be provided by a person connected to a director, that person must also agree in writing to the maximum amount;
     b. All directors (except for the director receiving the payment) must agree in writing that they are satisfied that the payment is being made in accordance with the requirements of this Regulation.
     c. The board of directors must consider any guidance respecting payments made under this Regulation that is issued by the Public Guardian and Trustee and published on a Government of Ontario website.

3. There must be at least four voting directors on the board, not including the director receiving the payment.

4. Neither a director who would receive the payment nor a person connected to a director must attend any part of the board meeting during which the decision to authorize the payment is discussed, nor vote on the matter.

5. The total number of persons (directors and connected persons) receiving payment must not exceed 20% of the number of voting directors on the board.

6. The directors must ensure that information respecting payments made under this Regulation in a given year is noted in the charity’s financial statements for that fiscal year, and presented to its members at an annual meeting.

Contact your Deloitte tax advisor to determine how the Regulation may apply to your situation.

For additional information on the new regulation, please refer to the following resources:

Ontario Regulation 4/01 amended on April 1, 2018 https://www.ontario.ca/laws/regulation/010004

Guidance on Payments to Directors and Connected person published with respect to the Ontario Regulation 4/01: https://www.attorneygeneral.jus.gov.on.ca/english/family/pgt/authorization_of_payments.html

Public Guardian and Trustee webpage: https://www.attorneygeneral.jus.gov.on.ca/english/family/pgt/charities/

Change to the T3010 submission

In an announcement on September 14, 2018, the CRA stated that the mailing address for the T3010, Registered Charity Information Return, will be changing as of October 8, 2018. The address change applies only to the T3010 and not to any other document filings. Charities filing their T3010s on or after October 8, 2018 will need to ensure that their annual returns are mailed to:

Charities Directorate
Canada Revenue Agency
105 - 275 Pope Road
Summerside, PE  C1N 6E8

Please note that this change applies only to the annual return. All other correspondence should be sent to:

Charities Directorate
Canada Revenue Agency
Ottawa, ON  K1A 0L5

Mail your returns to the new address if you are filing the T3010 on or after October 8th. Before this date, all returns should be directed to the Ottawa address.


Bessy Triantafyllos
Partner, Tax
Phone: 416-874-4425

Katerina Jirovcova
Senior Manager, Corporate Tax Advisory
Phone: 613-751-5290

Andrea Chalmers-Ozimec
Manager, Corporate Responsibility
Phone: 416-601-6129

Sarah Chapman
Director, Corporate Responsibility
Phone: 416-202-2532


Sam Persaud Sam Persaud
Partner, Public Sector Audit
Sam has over 35 years of public accounting experience, specializing in the provision of audit and assurance services to many NPO clients of our firm. Sam’s extensive experience has allowed him to provide valuable insights to his clients in the areas of financial reporting, governance, internal controls and risk identification and risk management. Sam has volunteered with a number of organizations, including the United Way of Greater Toronto. He is an editor of A State of Change, our Canadian National not-for-profit newsletter.
Lilian Cheung Lilian Cheung
Senior manager, National Assurance Services
Lilian specializes in audits of not-for-profit and public sector organizations. She is an editor of A State of Change, our Canadian National not-for-profit newsletter. Lilian spent two years on secondment with the Canadian National office, providing support to client service teams on assurance matters in the private company, public sector, and not-for-profit spaces.

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