Canada: Proposed increase to disbursement quota rate for charities, NPOs
Draft legislation that would increase the disbursement quota rate for charities and non-profit organizations
Draft legislation that would increase the disbursement quota rate for charities and NPOs
The Department of Finance released draft legislation that would increase the disbursement quota rate to 5% (from 3.5%) for charities and non-profit organizations (NPO) that have fiscal periods beginning on or after 1 January 2023.
This measure was originally announced in the 2022 federal budget. Read TaxNewsFlash.
Note that another federal budget measure that allows charities to make certain disbursements to non-qualified donees, was recently enacted.
Registered charities affected by the disbursement quota change need to review the proposed legislation and prepare now for these disbursement quota changes that are scheduled to come into effect in 2023. In particular, affected charities may need to review their policies and procedures to account for this change.
Read an August 2022 report [PDF 181 KB] prepared by the KPMG member firm in Canada
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