Making a gift of stocks or securities

A donation of publicly traded stocks, or securities, is a cost-effective way to transform a past investment into immediate and significant support for Parkinson Canada. If you own stocks or mutual funds that have grown in value, you are required to pay tax on 50 per cent of the capital gains. If you donate the securities to charity, you pay no capital gains tax. You will also receive a charitable tax receipt for the fair market value of the securities, and that entitles you to additional tax savings. This makes appreciated stock one of the most worthwhile ways to help people living with Parkinson’s disease.

You have the option of donating stock or securities now, or including this as part of your estate and Will planning.

The following chart highlights the benefits of donating a security to a charity instead of selling the security and then donating the proceeds.

Eliminate the Tax!
Sell Shares and Donate the Cash Donate Shares Directly
Market Value of Securities $10,000 $10,000
Adjusted Cost Base (securities original cost) $ 4,000 $ 4,000
Capital Gains ($10,000 – $4,000) $ 6,000 $ 6,000
Tax on Capital Gains @ 46% tax bracket -$1,380 paid out in taxes $  0
Donation tax credit* $4,600 $4,600
Net tax savings to donor (tax credit less tax due) $3,220 $4,600

* assumes gift made in Ontario at a marginal tax rate of 46%.

Overall, any type of donation made to a charity will fuel hope and make a tremendous difference. But, making a donation of securities or mutual funds will enable you to maximize your giving through increased tax savings and available tax credits.

Please Seek Expert Advice: If you are thinking about transferring assets that have appreciated in value, you should seek expert advice from a tax specialist, financial planner, or a lawyer.

For information on how to make a gift of securities or mutual funds to Parkinson Canada, please contact Sue Rosenblat (sue.rosenblat@parkinson.ca, 416-227-3386) or Steve Nash (steve.nash@parkinson.ca, 416-227-3378.)

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