no167 - BBM Case Comment

CHARITY LAW BULLETIN NO. 167Carters Professional Corporation / Société professionnelle Carters MAY 29, 2009Barristers, Solicitors & Trade-mark Agents / Avocats et agents de marques de commerce Editor: Terrance S. CarterNON-PROFIT COMMERCIAL ACTIVITY:A CASE COMMENT ON THEBBM CANADA DECISION*By Karen J. CooperA. INTRODUCTIONCRA recently released a brief discussion of the difference between registered charities and non-profits on the 1Applying for registration section of its website, highlighting that while both types of organizations function2on a non-profit basis, they are defined very differently under the Income Tax Act (the “ITA”) and they can also operate very differently. In the Tax Court of Canada decision of BBM Canada v. Canada (Minister of 3National Revenue) (the “BBM Case”) the Court discusses the requirements for non-profit organizations. While this decision specifically relates to the criteria for an organization to be recognized as “non-profit” under the Act, the Court makes a number of general statements regarding acceptable commercial/business activity, statutory interpretation and the practices of the Canada Revenue Agency (“CRA”). This Charity Law Bulletin reviews the Court’s decision in the BBM Case and discusses how it may be of interest to non-profit organizations. *Karen J. Cooper, LL.B., LL.L., TEP, is a partner with Carters Professional Corporation, Ottawa, Ontario, Canada. The author would like to thank Jeremy Tam, ...