A charitable foundation that meets the following requirements:
- No more than 50% of the directors, officers, trustees or like officials deal at arm's length
- with each other;
- with each of the other directors, officers, trustees or like officials; or
- with a person that contributed amounts representing more than 50% of the organization's capital or with each of the members of a non-arm's length group of persons that contributed such amounts.
- If more than 50% of the capital was contributed by one person, the foundation is not controlled, in any way whatsoever, by that person or by members of a non-arm's-length group of persons one of whom does not deal at arm's length with that person.
As used here, the terms “person” or “group of persons” do not include the Government of Canada or a provincial government, a municipality, a charity registered as a charitable organization or a public foundation, or a club, society or association that is exempt from income tax.