Gifts of securities or mutual funds
When you sell shares you are responsible to pay tax on the difference between the purchase and selling price - the capital gains. Let’s say you purchased common shares in ABC Company for a cost of $1,000. If the current market value of those shares has increased to $5,000, you would have a capital gain of $4,000.
Canada Revenue does not apply capital gains tax on donations of publicly traded securities. When you donate your securities directly those capital gains aren’t subject to tax. This means your charity receives a larger gift, and you receive a receipt for the full value of your eligible securities or mutual funds.
Here are some approximate figures to illustrate:
In this illustration, you’re able to donate the full value of your securities to charity: $5,000.00. Your tax credit on that amount would be approximately $2,300, or about $920 more than if you had sold the shares and donated the proceeds as cash.
By donating shares directly, you can save on taxes while you’re offering more help to the charities you care about most.
If you are interested in donating securities or mutual funds, please contact us at (613) 645-4040 to receive the documentation to donate directly to Hospice Prince Edward Foundation, or use this link to donate securities through Canada Helps.