One of the big questions this year is: how come my HoHoTO tix and sponsor packages now have HST on them?
It’s a pain, we know, but we’re afraid we have no choice. Last year’s HoHoTO brought in $40,000. We hope and expect to raise even more this year. That puts us over the $30K small vendor tax allowance so we are not tax exempt.
But wait: isn’t HoHoTO a charity-focused event? Well, yes, but it’s complicated:
- Every cent we take in (after some small expenses) goes directly to the Daily Bread Food Bank;
- Daily Bread is a registered charity;
- But HoHoTO is not.
By definition, HoHoTO is actually a revenue-generating event that is selling a product or service. We know this sounds wrong, but we don’t make the tax rules and we’re advised that HST must apply to all that we do. We wish that wasn’t the case too.
Couldn’t we just register to become a charity or incorporate as a non-profit? Sure, we could do that. And incur the registration costs, the admin overhead, the need to file all kinds of financials and other paperwork; inevitably to end up running a whole big operation just to navigate the shark-infested bureaucratic waters of the non-profit world.
We could do that. And every step of the process would, we know, suck more money away from the Food Bank.
Everything we do is designed to ensure the hungry people of Toronto get as much money and food as we can possibly generate, with the lowest possible overhead. We beg, borrow, cajole, and do everything we legally can to make sure our expenses are as tiny as they can be.
Want the numbers? At the first event in 2008 we managed to raise $25,000. Our expenses included drink tickets for sponsorships, venue security and technicians, plus PayPal fees and some printing costs. The wonderful people at the Mod Club waived the usual venue fees, including all the waitstaff who volunteered their time. All said, our expenses were less than $5,000.
HoHoTO 2009 raised $50,000 and we still kept the expenses under $5K. Of course, this means that we actually have to bring in around $55K gross for $50K net, savvy?
We think that’s pretty darn good for a 650-person party and, frankly, we’re not interested in adding any complexity that might increase the cost overhead.
HoHoTO works because of the absence of structure. We’re not an entity – we’re a bunch of people. We’re a community. We’re not a foundation. We’re not a charity. And we’re not, sadly, tax exempt.
We are, however, the best Holiday party you’ve ever been to and a great way to help feed a whole lot of desperately poor people.