By Terrance S. Carter & Ryan M. Prendergast

Introduction and Background

On October 2, 2025, the National Security and Intelligence Review Agency (“NSIRA) released a report (the “NSIRA Report”) discussing the findings of their review of the Canada Revenue Agency’s (“CRA”) Review and Analysis Division (“RAD”). As a response to public concern that had been raised, the NSIRA Report assessed whether RAD had treated registered Canadian charities fairly and without religious discrimination. Specifically, there were concerns raised that Muslim charities were disproportionately the target of RAD charity audits.

As discussed in our February 2022 Charity and NFP Law Update, after allegations of anti-Islamic bias in the CRA Charities Directorate, in August 2021, the Minister of National Revenue tasked the Office of the Taxpayers’ Ombudsperson to explore complaints by Muslim-led charities about their experiences. On February 9, 2022, the Ombudsperson published an update regarding its examination of the fairness of the audit process. According to the update, a special ombudsperson response team was created to analyze how the CRA selects charities to be audited, whether the process is designed and applied fairly, whether there are areas that may be inequitable, and the impact of the audit process on registered charities.

As further discussed in our January 2023 Charity & NFP Law Update, on November 21, 2022, the Taxpayers’ Ombudsperson provided an update regarding the review of CRA’s treatment of Muslim charities. The Ombudsperson expressed that it was impossible to validate certain aspects of the CRA’s practices because of legislation and the CRA policy regarding not disclosing taxpayer information. The report was published on March 27, 2023, and stated that the office did not have sufficient information to carry out the review due to obstacles with accessing complete files for the review. However, the report provided a recommendation that the CRA create a mandatory unconscious bias training course for employees of the CRA’s Charities Directorate. On March 8, 2023, the Executive Director of NSIRA sent a letter to the CRA Commissioner notifying him that NSIRA would be commencing a review of RAD within the CRA.

As noted in our November 2023 Charity & NFP Law Update, on November 2, 2023, the Standing Senate Committee on Human Rights (the “Committee”) released a report entitled Combatting Hate: Islamophobia and its Impact on Muslims in Canada (the “Committee’s Report”). The Committee’s Report discussed the rise in Islamophobia and presented 13 recommendations to address it. The Committee’s Report contained four sections. Of particular relevance was section four which stated that it was clear that RAD, whether or not intentional, demonstrated structural bias against Muslim charities. As such, recommendations 9, 10 and 11 recommended requiring the CRA to collect and publish data on religious organizations subject to audits and revocations, review the mandate and functioning of RAD, taking into account the conclusions of NSIRA’s review, and introduce an independent civilian body to review decisions of the CRA’s Charities Directorate.

On October 2, 2025, NSIRA published their report which assessed whether RAD “treated registered charities fairly and without discrimination on the basis of religion in the exercise of its duties under the Income Tax Act”.

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​Read the October 2025 Charity & NFP Law Update