What Are the Consequences of Non-Compliance for Registered Canadian Amateur Athletic Associations (RCAAA) under the Income Tax Act?

In Canada, registered Canadian Amateur Athletic Associations (RCAAAs) play a vital role in promoting amateur sports and physical activities. However, like any organization, they must comply with the requirements of the Income Tax Act to maintain their registered status. The Canada Revenue Agency (CRA) has introduced measures to ensure compliance, including sanctions and objection processes.

Sanctions:‍

As of January 1, 2012, the CRA has the authority to impose intermediate sanctions on RCAAAs that fail to comply with the Income Tax Act. These sanctions can include financial penalties and the suspension of qualified donee status. Losing qualified donee status means that an RCAAA cannot issue official donation receipts or receive gifts from registered charities for up to one year.

Sanctions typically result from an audit conducted by the CRA. If the agency proposes a sanction, it must provide written reasons, giving the organization an opportunity to respond. A list of sanctions applicable to RCAAAs can be found on the CRA's website under "Penalties and suspensions."

Objections:

If an RCAAA disagrees with an assessment or notice issued by the CRA, it has the right to appeal the decision through the objection process. The organization must file a notice of objection within 90 days of receiving the notice in writing. The objection must outline the reasons for disagreeing with the CRA's decision and provide all relevant facts to support the objection.

For more detailed information about the objection process, RCAAAs can visit the CRA's website section on "Objections and appeals."

In summary, registered Canadian amateur athletic associations are subject to sanctions and have the option to object to CRA decisions. It is essential for these organizations to understand their obligations under the Income Tax Act and to comply with CRA requirements to maintain their registered status and continue their important work in promoting amateur sports across Canada.