How do I set up a charity account in Canada?
Depending on your goals and size, you may want to incorporate your charity at the federal or provincial level. Incorporation can provide limited liability for directors and can be beneficial for organizational structure.
To receive tax-exempt status and be able to issue tax receipts for donations, you must apply to the Canada Revenue Agency (CRA) for charitable status.
Ensure your charity’s purposes fall within the four recognized categories: relief of poverty, advancement of education, advancement of religion, or other purposes beneficial to the community.
Prepare Documentation your charity’s constitution, bylaws, and articles of incorporation (if incorporated). Outline your planned charitable activities and how they align with your charitable purposes.
Provide a budget and financial plan, including funding sources and projected expenses. List the names, addresses, and occupations of your board of directors. Ensure your board complies with any residency requirements. Implement a policy to handle conflicts of interest among board members.
Select a bank that offers accounts tailored to non-profit organizations and charities. Many major banks in Canada, such as RBC, TD, BMO, CIBC, and Scotiabank, offer specialized charity accounts.
Visit the bank in person with the required documents or complete the application process online if available. Fill out signature cards for all authorized signatories. Make any required initial deposit to open the account.
Implement proper bookkeeping and accounting practices. Consider using accounting software tailored for non-profits. Regularly reconcile your bank statements with your financial records.
Ensure timely and accurate filing of annual returns and financial statements with the CRA and other relevant authorities.
You can also place free funds on a savings account.
Calculate your future income on a savings account (example):
| Amount, $ | Rate, % | Accrued %, $ |
| 25,000 | 3.65% | 913 |
| 25,000 | 3.75% | 938 |
| 25,000 | 3.85% | 963 |
| 60,000 | 3.95% | 2,370 |
| 60,000 | 4.05% | 2,430 |
| 60,000 | 4.15% | 2,490 |
| 140,000 | 4.25% | 5,950 |
| 140,000 | 4.35% | 6,090 |
| 140,000 | 4.45% | 6,230 |
| 340,000 | 4.55% | 15,470 |
| 340,000 | 4.65% | 15,810 |
| 340,000 | 4.75% | 16,150 |
Are community accounts the same as not-for-profit and charity accounts?
In Canada, community accounts, not-for-profit accounts, and charity accounts are related but distinct types of bank accounts designed to meet the needs of different types of organizations.
- Charity Accounts - specifically designed for registered charities that have been approved by the Canada Revenue Agency (CRA). Charities are organizations that operate for charitable purposes and can issue official tax receipts for donations.
- Not-for-Profit Accounts - designed for not-for-profit organizations that operate for purposes other than generating profit for their members. These organizations can include social clubs, community groups, and various other organizations that do not qualify as charities.
- Community Accounts - typically a type of account offered by banks that cater to community organizations, including both not-for-profits and charities. These accounts are designed to provide banking services suited to the needs of community-based organizations.
See the similar FAQ about Canadian banks:
- B2B bank RRSP loan
- CIBC collections contact
- CIBC loan and financial calculators
- Citizens Bank student loans
- Coast Capital calculators
Details of companies offering the financial services:
Bank Of Montreal
Head office’s address: 119, rue Saint-Jacques Montreal, Quebec H2Y 1L6
Contact center: 877-225-5266
Phone: 416-867-5000
Web-site: http://www.bmo.com/main/personal
Swift code: BOFMCAM2
Stock code: BMO
BSB: 001
CIBC
Head office’s address: 199 Bay St, 44th Floor Toronto
Contact center: 800-465-2422
Web-site: https://www.cibc.com/en/personal-banking.html
Swift code: CIBCCATT
Stock code: CM
BSB: 010
RBC Royal Bank
Head office’s address: 200 Bay St, 9th Floor South Tower, Toronto
Contact center: 800-769-2511
Web-site: http://www.rbc.com/canada.html
Swift code: ROYCCAT2
Stock code: RY
BSB: 003
TD Bank
Head office’s address: Toronto-Dominion Centre, Po Box 1 Stn Toronto Dom, Toronto
Contact center: 866-222-3456
Web-site: https://www.td.com/about-tdbfg/our-business/index.jsp
Swift code: TDOMCATTTOR
Stock code: TD
BSB: 004