A non-profit organization is a legal entity with a separate existence, independent of its members, created for non-profit purposes to promote charitable, religious, educational, sporting or patriotic objectives.
A nonprofit organization is a type of limited liability company. The main difference between it and a commercial company is that a nonprofit organization cannot issue shares for dividends like a commercial company, and cannot use the profits of its members, directors, and managers as its operating goal. Any financial gains must continue to be used for activities that are consistent with the purpose of the organization.
Generally speaking, there are five types of nonprofit corporations: 1) Industry associations; 2) Sports organizations; 3) Legal aid organizations; 4) Service associations; 5) Charity.
Non-profit organization registration services
- Golden Key Business Development Centre is an authorized company registration agent by the Canadian federal government's corporate and community management department. It is very common to set up a non-profit organization in Canada. Regardless of whether you have Canadian citizenship or not, as long as there is one or more persons over 18 years old who have not filed for bankruptcy and have the capacity to act, you can register a non-profit organization in Canada. Their forms include: associations, chambers of commerce, societies, research institutes, hometown associations or societies, and clubs are all fine.
Workflow
As a consulting company serving the Greater Toronto Area for more than 10 years, our services and prices have always been very attractive. In order to provide higher quality, more comprehensive and thoughtful services, and to maintain our prices that have not changed for ten years, here is our streamlined work process:
- Fill out the form quickly online and provide all the basic information
- Arrange consultation time by phone, WeChat or email
- Payment according to the contract price
- We will prepare your application documents and review the information within 24 working hours.
- Submit registration application
- Ontario registration is usually successful within 24 hours; federally registered companies will receive registration feedback within 48 hours. Due to the restrictions on company names, the processing time can generally be controlled within one week.
Characteristics of non-profit organizations
- The company is managed by a board of directors elected by the members
Typically, the board of directors is responsible for appointing the secretary, trustees, chairman, etc., who are responsible for the actual running of the company. - Directors “own” the company
No director, officer or member may "own" the corporation, nor have title to any particular asset of the corporation, and the corporation may not be operated for the financial benefit of its members, directors or officers. - Multiple sources of funding
The funding sources of Canadian non-profit organizations include membership dues, donations, grants from local and federal governments, and revenue from the sale of goods and services. - In some cases, a nonprofit corporation may engage in activities that generate “profit”
The activity must be consistent with the purpose for which the corporation was formed. For example, a men's ice hockey club might hold a dance to get new uniforms for the team. If, after paying the expenses, the dance generates "profits," those monies belong to the club and are used for the club's benefit, i.e., to purchase new uniforms for its team. - Strict audit system
Since the purpose of non-profit organizations is not to create profits, the government also evaluates their operations, including project implementation, fund use, annual reports, etc. Non-profit organizations must comply with specific financial policies and accept comprehensive audits. If these organizations do not operate in accordance with relevant regulations, the government will pay taxes in accordance with relevant provisions.
Information required to register a non-profit organization
- Name and initial registered office address of the non-profit organization
- A complete board charter (including purpose, target group, etc.), Canadian non-profit organization draft agreement
- Information on the first board of directors
- English or French can be selected as the institutional language
You do not need Canadian citizenship to register a non-profit organization in Canada. If the non-profit organization does not publicly accept donations or government grants of less than 10,000 Canadian dollars, it only needs one director who is over 18 years old, has no bankruptcy record and has normal behavior. However, if it publicly recruits or accepts government grants of more than 10,000 Canadian dollars, it must have three directors or more.
How to apply to set up a charity?
Only institutions that can help the general public get out of poverty, sponsor students to go to school or are religious (such as schools, hospitals, churches, etc.) can apply for charitable organizations. Charitable organizations can purposefully accept donations from the public and produce receipts for donations. Other non-profit organizations generally cannot issue donation receipts.