United Empire Loyalist Association relationship with “Branches”
The Dominion entity was created by Legislation by the Government of Canada May 27, 1914.
The Act does not mention branches or any subsidiary “Branches, Chapters, etc.”
What has evolved over time, so called Branches have been established with 29 autonomous groups with an arms-length relationship with the Dominion.
The Dominion Charter gives it the authority to approve persons to use the U.E. designation. The Branches do not have such authority. The Dominion corporation is a Registered Charity with Revenue Canada and has a HST registration number. The Dominion offices provides services to the Branches such as –
- establishing a permanent office with staff to support the Branches
- the governance of the corporation is by elected persons from the Branch memberships
- Dominion initiates an annual meeting hosted by a designated branch were all Branch member delegates select the members of the executive of Dominion and appoint the officers of the corporation
- maintains a registry of the members of the branches
- establishing a Web Site
- printing of membership cards
- establishing guideline for the operation of the corporation
- for these services the Branches pay a portion of their membership fees to the Dominion
The Dominion organization does not
- Report consolidate the financial information of the branches into their reports
- Have “members”, all members are members of a “Branch”
- An operating role within any “Branch”
DEFINITION of ‘Branch Office’ as per the dictionary
A location, other than the main office, where business is conducted. Most branch offices are comprised of smaller divisions of different aspects of the company such as human resources, marketing, accounting, etc. A branch office will typically have a branch manager who will report directly to, and take orders from, a management member of the main office.
The UELAC definition of “Branch” is not in the context of generally accepted business terminology
The UELAC “Branches” are deemed to be separate legal entities by Revenue Canada they can be
- A Not for Profit Organization composed of an association of persons with a common interest.
The members of the Association are deemed to be jointly and severally liable for the actions of the association.
(To sue or to be sued is a complicated issue.)
- Registered Charity similar to a Not for Profit organization but with the ability to issue Income Tax donation Receipts subject to the rules of Revenue Canada. An organization cannot be a Not for Profit Organization and a Registered Charity at the same time.
- A Not for Profit Corporation registered provincially or federally.
The ordinary Members of a corporation are not liable for the debts of the corporation, the officers may be held liable for certain actions in some cases.
(A Not for Profit Corporation can sue and be sued.)
(Federally the Canada Not for Profit Corporations Act and Income Tax Act govern the operation of the Corporation)
(In the Province of Ontario operation of the Corporation is Ontario Corporation Act and the Income Tax Act apply, the Ontario Not for Profit Corporation has not been implemented as of 2015)
A Not for Profit Corporation may have registered charity status if they meet the requirements of Revenue Canada
A Registered Charity that is a Not for Profit Corporation (Revenue Canada form T2050)
- Issue Income Tax Charitable Receipts
- The Members of the organization do have corporate liability protection
- Is only required to file the Registered Charity returns, it does not have to file the T2 Corporate tax return nor does the Registered Charity return have to be audited by a third party agency
- A UELAC Branch cannot function as a partnership.
A Not for Profit Organization (association) is the most simple form of activity, the only requirement is to file returns with Revenue Canada annually as noted below but it does have the greatest risk for it members.
An organization has to file a return if:
it received or is entitled to receive taxable dividends, interest, rentals or royalties totaling more than $10,000 in the fiscal period;
it owned assets valued at more than $200,000 at the end of the immediately preceding fiscal period; or
it had to file a NPO return for a previous fiscal period.
A Registered Charity is similar to a Not for Profit Organization but will be required to file Returns and Financial Statements to with Revenue Canada.
A Not for Profit Corporation is required to file audit annual financial statements with Revenue Canada even if the corporation is not a Registered Charity. A Not for Profit Corporation can be a Registered Charity. Generally government and business agencies will only make donations / gifts to Not for Profit Corporation or Registered Charity as they rely upon Revenue Canada to deem the activity is legitimate.
When does a registered charity have to file its information return?
Under the Income Tax Act, every registered charity must file an information return each year. Form T3010 and related documents must be filed no later than six months after the end of the charity’s fiscal period. For example, if the charity’s fiscal period end is March 31st, its information return and related documents are due by September 30th.
If the charity is a corporation, it is not required to file a T2 Corporation Income Tax Return during the period it has Registered Charity status. If the charity loses its charitable status, it will be required to resume filing the T2 return. For more information regarding T2 filing requirements, call Business Enquiries at 1‑800‑959‑5525.
