A charity that is either a corporation or trust, and that meets the following conditions:
- It is established and operated exclusively for charitable purposes, including the payment of funds to a qualified donee.
- As a rule, no part of its income is used to pay, or is otherwise made available to, any proprietor, member, shareholder, trustee or settlor of the charity.
To be considered a public foundation, the charity must also meet the following conditions:
- More than 50% of its directors, officers, trustees or like officials deal at arm's length
- with each other;
- with each of the charity's other directors, officers, trustees or like officials; and
- with a person that has provided amounts representing more than 50% of the charity's capital, or with each member of a group of persons not dealing at arm's length with each other, if the group has provided such amounts.
- Where a particular person has provided more than 50% of the charity's capital, the charity is not controlled in any manner whatever by that particular person, or by a group of persons not dealing at arm's length with each other, one of whose members does not deal at arm's length with that particular person.
In this definition, the terms "person" and "group of persons" refer to any person or group of persons other than:
- the Government of Canada or a provincial government
- a municipality
- a charity registered as a charitable organization or as a public foundation
- a club or association that is exempt from tax