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Canada Revenue Agency requires that
a registered charity must spend its Disbursement Quota (at least 80 per cent
of its tax receiptable donations) on charitable activities. The remainder
is available for management, administration, and other operating expenses.
Note that:
Canada Revenue Agency states explicitly that fundraising is not a charitable activity.
The 80 per cent rule does not apply to revenue that is not tax-receiptable, e.g. government grants, donations from other charities, cookie sales, coin receptacles, lotteries, bingos, etc.
Canada Revenue Agency currently permits charities to respect the 80 per cent rule "on an overall basis" for a maximum of seven years.
| Benchmarks for fundraising costs:
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| Direct mail acquisition | 90 cents to $1.25
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| Product sales | 35 cents
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| Telephone solicitation | 32 cents
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| Special events | 50 cents
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| Planned giving | 25 cents
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| Gaming (bingo, lotteries, etc.) | 23 cents
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| Direct mail renewal | 20 cents
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| Corporations/Foundations | 20 cents
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| Capital campaigns | 10 to 20 cents
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| Workplace giving | 7 cents
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| Average CTRAD | 26 cents
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Cited in Ryerson Polytechnic University's Centre for Voluntary Sector Studies. Sources: Association for Healthcare Philanthropy (AHP), Librarian Erica Heftmann, reported in Canadian Fundraiser, July 31, 1996 and Canada West Foundation survey of 1,516 charities (excluding religious groups and private foundations) reported in The Globe and Mail, August 27, 1996.
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