Religious And Charitable Organizations

Information Bulletin 3-98, July 2002

This Information Bulletin is provided as a guide only. It is not intended as a substitute for the Employer Health Tax Act and Regulations.

Important

Each location of a registered charity may be treated as a separate employer for Employer Health Tax (EHT) purposes with each location entitled to claim the exemption.

Eligibility

Registered charity

The religious or charitable organization must be a registered charity which is exempt from income tax under paragraph 149(1 )(f) of the Income Tax Act (Canada).

Eligible employer

In addition, the registered charity must be an eligible employer as defined by the Employer Health Tax Act. In general, this would include private sector employers and organizations that may receive financial assistance from any level of government but are not under the control of government.

Tax exemption

Exemption amount

Effective January 1, 1997, eligible employers became exempt from tax on the first $200,000 of annual remuneration. This exemption increased to $350,000 for 1998 and to $400,000 for 1999 and subsequent years.

Separate location

A registered charity that is an eligible employer can treat each of its locations as a separate employer and each location will be eligible to claim the exemption for the year. There must be formalized evidence that the branch, division or parish is separate from the main body of the organization. Any one of the following factors may demonstrate this:

a location is publicly advertised on the charity's letterhead, on business cards or in telephone directories and there is supporting evidence that the location belongs to the charity (e.g. property tax bill, lease agreement or other third party documentation)
a branch, division, parish, etc. has its own charitable registration number
a branch, division, parish, etc. files its own "Registered Charity Information Returns."

Refund

Refund application

A registered charity with more than one branch, division, or parish may apply for a refund if it has filed as a single employer and claimed only one tax exemption for all of its locations. A request for a refund must be made in writing and submitted with supporting documentation to the Ontario Ministry of Revenue tax office closest to you.

Refund enquiries

Any enquiries that you may have regarding a request for a refund should be made to the Ontario Ministry of Revenue tax office closest to you.

Request for official interpretations

For official interpretations, or to find out if an employer is considered a "separate employer", please outline all of the facts of the situation, in writing, to:

Ministry of Revenue
Tax Advisory Services Branch
Employer Health Tax
33 King Street West
Oshawa ON L1H 8H5

Related EHT information bulletins

Information bulletins

Other EHT Information Bulletins providing further details on this topic include:

Further information

To obtain the most current version of this publication, or additional information, visit our website at ontario.ca/revenue or contact the Ministry of Revenue at:

1 866 ONT-TAXS (1 866 668-8297)
1 800 263-7776 teletypewriter (TTY)

ISBN 0-7794-3202-9