How do I start a charity organization in Canada?

Question

I want to start a foundation that helps stop the war on drugs through helping addicts, funding political movements, advertising, and legal funds for people accused of drug offences. How do I start this fund, and still make money to live off of? Would it also be legal to use a non-profit organization to fund my rent and other house hold bills? What is a for profit charity? Would I need to start a for profit charity to live off the proceeds?

Answer 1

There is no such thing as a for profit charity.  By definition, if the intent is to earn a living, it's not a charity.

That's not to say that a foundation cannot be formed which works to help some group.  However, CRA has very strict reporting and other rules to allow it to solicit money and issue tax receipts.  For one thing, they will have to see very detailed financial records of where every penny of donated funds went, and they have to be convinced that the work of the group is suitable.  For instance, education is usually acceptable, actively funding legal bills may not be, but you need to contact CRA to find out about your specific ideas.

To form any group like this, you cannot do it yourself.  You need a group of like minded people who are willing to donate their time and effort to set up the legal and financial framework of the group, including filing all the required documents with CRA and other organizations.  There are minimum group sizes to ensure this is not just a way to pay your rent, but the way.

You cannot solicit donations until/unless you get CRA approval.  

If you do form the group properly and follow all the rules, it is possible for you to 'earn a living'.  Groups such as this can and often do have permanent, paid staff.  However, CRA will insist on the majority of donated funds going to the specified charitable work, not into your pocket.