Sample Contractor Agreement For A Canadian Registered Charity Carrying Out Foreign Activities


Sample Contractor Agreement for a Canadian Registered
Charity Carrying Out Foreign Activities
By Mark Blumberg, Blumberg Segal LLP (June 25, 2010)
Canadian charities often work with foreign intermediaries to conduct charitable activities
in other countries.
It is important that those Canadian charities when transferring
resources to a foreign intermediary have a written agreement with their foreign
intermediary to show that the Canadian charity maintains direction and control over its
foreign activities and meet the “own activities” test under the Income Tax Act (Canada).
See the CRA “Consultation on the Proposed Guidance on Activities Outside of Canada
for Canadian Registered Charities”
which sets out CRA’s views of the relationship
between Canadian charities and non-qualified donees (including foreign charities).
There are many different types of relationships that a Canadian charity can utilize with a
foreign intermediary including contractor, partnership, agency, joint venture or
CRA describes the “measures of control” including written
agreements, clear and complete description of activities, monitoring and supervision,
ongoing instruction, periodic transfers, and separate activities and funds. A proper
written agreement sets out exactly how funds will be used, what monitoring and reporting
will take place, the schedule of progress payments, and any termination provisions.


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