Ottawa, Ontario, May 3, 2013. . . The Canada Revenue Agency (CRA) will revoke the registration of Trinity Global Support Foundation, a London-based charity. The notice of revocation will be published in the Canada Gazette with an effective date of May 4, 2013.
On February 1, 2013, and in accordance with subsection 168(1) of the Income Tax Act, the CRA issued a notice of intention to revoke the registration of Trinity Global Support Foundation as a charity. The letter stated, in part, that:
Our audit revealed that the Organization devoted a significant portion of its resources to the promotion of the Mission Life Financial Inc. and Canadians Care donation arrangements. As a result of its participation in these arrangements, between June 1, 2007 and May 31, 2010, the Organization reportedly received nearly $25 million in cash and in-kind property.
With respect to the Mission Life Financial Inc., a registered tax shelter, the Organization issued tax receipts exceeding $1.13 million for cash contributions and $16 million for pharmaceuticals. Of the cash contributions received, the Organization paid nearly $1.03 million to the promoters of the tax shelter and to the Organization’s directors or related parties. It is our position the Organization issued the tax receipts improperly, particularly given our finding that the $16 million recorded for the pharmaceuticals were grossly inflated. As a result, we conclude neither contribution qualifies as gifts at law.
With respect to the Canadians Care promoted donation arrangement, the Organization issued tax receipts exceeding $7.8 million for leveraged cash contributions. The Organization invested over $7 million into investments held by corporations related to its directors and also related to the donation arrangement. These funds were subsequently lost due to the actions of those corporations. The Organization was also found to have improperly paid over $865,000 to individuals and corporations related to the Organization’s directors.
A copy of the notice of intention to revoke and other letters relating to the grounds for revocation are available to the public on request, in the language they were originally written, by calling 1‑800‑267‑2384.
An organization that has had its registration as a charity revoked can no longer issue donation receipts for income tax purposes and is no longer a qualified donee under the Income Tax Act. The organization is no longer exempt from income tax, unless it qualifies as a non-profit organization, and it may be subject to a tax equal to the full value of its remaining assets.
Registered charities perform valuable work in our communities, and Canadians support this work in many ways. The CRA regulates these organizations through the Income Tax Act and is committed to ensuring that they operate in compliance with the law. When a registered charity is found not to comply with its legal obligations, the CRA may revoke its registration under the Income Tax Act.
The CRA is reviewing all gifting tax shelter schemes (for example, schemes that typically promise donors a tax receipt worth more than the actual amount of the donation), and it plans to audit every participating charity, promoter, and investor. For more information about tax shelters, go to the CRA’s Tax alert Web page at www.cra.gc.ca/alert.
For more information about the registration of Canadian charities, go to the CRA’s Charities and Giving Web page at www.cra.gc.ca/charities.
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The Canada Revenue Agency has announced that it will revoke the registration of Trinity Global Support Foundation, a London-based charity. The revocation will come into effect on May 4, 2013.