Incorporating a Not-for-Profit Corporation in Ontario

Incorporating a not-for-profit corporation in Ontario is a manageable process, but it begins with a decision that shapes everything that follows and is frequently made without much deliberation. Before filing anything, an organisation must determine what kind of not-for-profit it intends to be.

A public benefit corporation includes charities and any organisation that receives more than $10,000 in a financial year from government funding or public donations. A non-charitable not-for-profit covers clubs, social organisations, professional associations and similar bodies. The distinction is not administrative. A charitable corporation must have exclusively charitable purposes — the relief of poverty, the advancement of education or religion, or another purpose beneficial to the community in a way the law recognises — and it is subject to oversight by the Office of the Public Guardian and Trustee. Purposes drafted loosely, or drafted with an eye to future flexibility, can place an organisation outside charitable status without anyone intending that result.

Once the character of the organisation is settled, the mechanics follow a defined sequence. The corporate name must comply with the Not-for-Profit Corporations Act, 2010 and must not be identical or confusingly similar to an existing name. This is confirmed through an Ontario-biased NUANS name search report, which must be less than ninety days old at the time of filing. Certain words, including "Charity" and "Foundation," require prior written consent from the Public Guardian and Trustee before they may be used.

The information required for filing should be assembled before beginning the application. This includes the corporate name taken from the NUANS report; a registered office address, which must be a physical location in Ontario rather than a post office box; the names and service addresses of the directors, of whom there must be at least three; the name and address of each incorporator; a clear statement of the corporation's purposes, drafted to meet CRA guidelines where charitable registration is intended; any special provisions such as governance restrictions; an official email address for the corporation; and the NAICS code corresponding to its principal activity.

The Articles of Incorporation are then prepared on the prescribed form. Charitable corporations must include the special provisions required by law. Where a director is not also an incorporator, a Consent to Act as First Director is required from that individual, and where the proposed name includes restricted words, the necessary written consent must accompany the filing.

The application may be submitted online through the Ontario Business Registry, which allows supporting documents to be uploaded and the fee paid by card, or by mail with a cheque payable to the Minister of Finance.

One point deserves attention from organisations that already exist rather than those being formed. The ONCA was proclaimed into force on 19 October 2021, and a three-year transition period ran until 18 October 2024. Any provision in an existing corporation's letters patent, supplementary letters patent, by-laws or special resolutions that conflicts with the ONCA is now, subject to limited exceptions, deemed to have been amended to comply with it.

The practical consequence is that a considerable number of Ontario not-for-profits are now governed by rules their own constating documents do not accurately reflect. Directors and members of those organisations may find it genuinely difficult to determine which of their by-law provisions remain in force. Any organisation incorporated before 2021 that has not undertaken a transition review should treat that as an outstanding item rather than a closed one.