T2 Not-For-Profit Corporartion

Tax Topics
1

I have never prepared a T2 Corporate Tax Return for a Not-For-Profit Corporation and I have two questions.

Nowhere in the preparation does it state where to indicate it is a NFP corporation. Where do I find this?
At the end of preparation the remains tax owing. My understanding is it should be “no Tax owing”. Does this get fixed when I enter the proper corporation type in question 1?

Thank you in advance for any help provided.

2

I believe it’s in the ID section (non-share corp - Y). Then choose an option below under “type of tax-exempt”.

3

Why would you be filing a T2 for a non profit as they should be filing a T3010? Since they are only reporting income and expenses.

4

T2 is mandatory to file for NPO. However we need to file T3010 if its also a registered charity.

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5

A T3010 is for a Registered Charity, not for all non-profits.

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6

Thank you so much for your help.

7

Thank you very much for your reply. It is not a registered charity. Only not-For-Profit corporation.

Cliff

8

Thank you for your reply.

Cliff

9

Correct not-for-profit accounting will show that there is never any profit in the corporation, thus no taxes could possibly be owing. Please review the bookkeeping.

10

Thank you for the heads up

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11

“Not for profit” is an expression of intent. The bottom line might not be called profit but it would take incredible precision to end each year at NIL.
“Excess of revenue over expenditures” maybe.

From “cliffgblank via protaxcommunity.com” <notifications@taxcycle.discoursemail.com>
To neal@nealnicholson.ca
Date 2023-03-22 10:52:40 AM
Subject [protaxcommunity.com] T2 Not-For-Profit Corporartion

12

Thank you. Yes, I was wondering the same thing. Not-for-profit corporation is the type of corporation and is exempt from taxes. So, if the net income would be NIL every year, I don’t know how this could be accomplished.

13

Here’s a decent article on how to do accounting/bookkeeping for non-profits: Deferral vs. Restricted Fund Method: What Non-Profits Need to Know

When done correctly, there is never a profit, because of the special methods of accounting for excesses and deficits in non-profit organizations.

14

This one might be more useful, as it demonstrates how the JE’s work: Accounting and Bookkeeping for Non Profit Organizations NPO Green Quarter Consulting Surrey BC

15

Thank you so much for your help

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