Generally, an individual is ineligible to serve as a board director if he or she:
- has been convicted of an offence
- related to financial dishonesty
- relevant to the operation of the organization
- was connected to an organization whose registration was revoked for a serious breach of the requirements for registration. The connection was as
- a director, trustee, officer, or like official
- an individual in a position of management or control
- a promoter of a tax shelter, and participating in that tax shelter caused the revocation of an organization’s registration
Although the Income Tax Act defines ineligible individual, it does not prohibit such an individual from being a director or employee. Rather, the Act allows the CRA to consider whether or not to take action in relation to a registered organization or an applicant in such circumstances.
To show due diligence on the part of the church board in screening potential board members, it is recommended that board members self-declare their eligibility to serve. It is recommended that board members signed a Declaration of Eligibility form annually to ensure ongoing due diligence by the church. (CCCC Charities Handbook). A policy may also be developed allowing the automatic removal of a director or trustee found to have violated the annual declaration.
(Download PDF in Resources Section)
Sample Annual Declaration of Directors Eligibility
as Defined in Subsection 149.1(1) of the Income Tax Act, RSC 1985, c. 1 (5th Supplement)
I, NAME OF INDIVIDUAL, serving in the capacity of BOARD MEMBER / TRUSTEE / OTHER with NAME OF LOCAL CHURCH registered with Canada Revenue Agency as BN/REGISTRATION # declare that I am not an ineligible individual by affirming all of the following statements:
- I do not have an unpardoned criminal record either in Canada or internationally, involving financial dishonesty, tax evasion, theft, fraud, or other offences involving breaches of the public trust; and
- In the previous five years, I have not been found guilty of a relevant offence either in Canada or internationally. Relevant offences involve financial dishonesty contravening any noncriminal laws such as breaches of legislation for charitable fundraising, consumer protection, or securities regulation; and
- In the previous five years I have not been a director, trustee, officer, like official, or an individual who controlled or managed either directly or indirectly in any manner whatever, a registered charity during which time the charity engaged in conduct which resulted in the registration of the charity being revoked; and
- In the previous five years I have not been a promoter of a tax shelter for which involvement the registration of a charity was revoked.
I acknowledge that any dishonesty on my part as to the truth of this declaration:
- may result in a one-year suspension of NAME OF LOCAL CHURCH to issue official receipts as authorized by Canada Revenue Agency; or
- may result in the charitable status of NAME OF LOCAL CHURCH being revoked by Canada Revenue Agency; and
- will result in the immediate termination of my role with NAME OF LOCAL CHURCH, whether I am an employee or volunteer.
Signature: Witnessed by:
Signature Witness Signature
Please Print Name Please Print Witness Name
Date Date
