By Brett McKay, Local Journalism Initiative Reporter, Investigative Journalism Foundation
Alberta’s New Life Pentecostal Church has lost its status as a registered charity after an audit revealed it had failed to devote funds to charitable purposes and provided “unacceptable private benefits to directors,” according to documents from the Canada Revenue Agency.
The CRA audited the Medicine Hat church’s operations for 2021 and 2022. During that time, auditors found more than $76,000 spent by the church went to personal expenses, ineligible gifts and to the charity’s director, Pastor Beau Zilinski, in unreported compensation and benefits, according to a Nov. 6, 2025 letter from the CRA to Zilinski.
In both 2021 and 2022, the CRA audit found Zilinski received about $25,000 more in pay and benefits than was reported to tax authorities. In addition to the underreported income, payments for personal expenses included Zilinski’s employee portion of CPP contributions and EI premiums, the purchase of personal use items, food related expenditures, and payments made to other non-qualified donees, the letter states.
The CRA flagged significant food related expenses, roughly $11,000 at restaurants and another $8,600 at grocery stores, for which the church failed to explain a charitable purpose. These expenses were also considered as conferring a personal benefit to Beau and Charmaine Zilinski, “as they are the only individuals with access to the organization’s bank accounts,” the CRA said.
The resources gifted to non-qualified donees and the unreported compensation and benefit amounts paid to the directors were equal to 29 per cent of New Life’s total expenditures in 2021 and 38 per cent in 2022, according to the CRA.
The CRA letter states there were multiple bookkeeping issues, and that auditors were not given adequate documentation to explain the differences between what New Life reported in its tax filings and what was recorded in its financial statements. For example, in 2021, the church reported in its taxes that the amount of all gifts for which the charity issued tax receipts was $104,000 while its financial records show it issued $120,836 in tax receipts.
The church also failed to report about $13,000 of revenue in the form of government subsidies from the Canada Emergency Rent Subsidy and Canada Emergency Wage Subsidy.
A representative of the church said in a Dec. 2025 letter to the CRA that many of the items listed as personal benefits relate to charity work, such as buying decor for the church and a barbecue that “is used specifically for charity events for the wellbeing of the church.” The letter also states that food is a “major part of fellowship and worship,” which justifies those expenses.
The representative for New Life also said payments found to be made to non-qualified donees were made to members of the organization who were in need.
In its letter, the church said it is making changes to comply with the issues raised in the audit, including agreeing to hire an outside bookkeeper and put together a board of directors that meets the requirements of the Income Tax Act.
A response from the CRA states that no additional documentation was provided to substantiate the explanations for expenses made by the church or the corrective measures taken.
The CRA said it maintains its position that New Life failed to meet the requirements for registration as a charitable organization and that there are sufficient grounds to revoke its charitable registration.
New Life and Zilinksi did not respond to a request for comment by the time of publication.
