Disbursement quota shortfalls and excesses

Spending too much

If a registered charity spends more on its charitable activities or qualifying disbursements through gifts to qualified donees or grants to non-qualified donees than its disbursement quota for the year, it has a disbursement excess. Disbursement excesses can be carried forward for five years or carried back one year.

Spending too little

If a registered charity spends less on its charitable activities or qualifying disbursements through gifts to qualified donees or grants to non-qualified donees than its disbursement quota for the year, it has a disbursement shortfall.

Making up a shortfall

A registered charity can draw on disbursement excesses from the five previous fiscal periods to help it meet a shortfall. If no excesses are available to draw on, the charity can try to spend enough the following year to create an excess that it can carryback to cover the shortfall.

Continuous shortfalls may lead to revocation of a charity's registration.