Example of a Gift of Appreciated Securites

A capital gain of $10,000 and a tax saving of $1,700
Gift of stock generates $20,000

Cash Gift

Stock Gift

Tax receipt issued is the same

$20,000

$20,000

Capital gain is the same

$10,000

$10,000

Taxable gain is 0% if a stock gift or 50% on cash from sale

$5,000

$0

Tax on gain (assumes 34% tax rate)

$1,700

$0

Tax credit (43.7% x $20,000)

$8,740

$8,740

Cost of Donation  (($20,000+ Tax) -(Credit))

$12,960

$11,260

 

 

Advantage of gift of stock:

$1,700

Making It Easy to Give...

Contributing appreciated securities is made easy by following this process:
 
1. Select the securities and quanitities of each you intend to donate and the recipient organzations.

2. Download the Gift Instruction Form:
 
3. Email Glen Mitchell or call him at (604) 684-6306 (Local 218) or Barbara Struthers (Local 222) for a form to authorize your investment broker to transfer the securities to the account of the Diocese of New Westminster.

4. Complete the information on each form and send them to the appropriate address:

4A. The Gift Form should be sent to Glen Mitchell at the Diocese of New Westminster, 580 - 401 W. Georgia St., Vancouver, BC V6B 5A1 or fax it to his attention at (604) 684-7017.

4B. The securities transfer form should be sent to your broker.

5. Once the securities are in our account, they are sold and you will receive a tax receipt for the amount of the sale.

6. The Diocese, on receipt of the funds from the sale, issues a cheque (or cheques) to the church organization(s) you specified in the Gift Form.

Gift of Securities

GOVERNMENT IMPROVES BENEFIT

When you donate appreciated securities to the Church,  you get a tax receipt for the full market value of the gift and pay NO tax on the gain derived from gifting the securities. It is the most tax-effective way to make a donation. To achieve the full tax advantage it is essential that the securities be donated rather than the cash from their sale.
 
The table on the right  illustrates how Susan Chow, who owns publicly listed stock with a capital gain of $10,000, will save $1,700 in taxes by donating the stock rather than selling the stock and donating cash. If the tax receipt exceeds 75% of her net income, she may carry the excess forward for up to 5 years to continue reducing tax.

CALCULATE your own gift. Email Glen Mitchell for a an EXCEL spreadsheet. You can type in your stock value, the adjusted cost base and your margin tax rate to see a close approximation of the benefit to you of this type of gift.

 

 

Stock Options

It is also now possible for employees of public companies to donate gifts of stock purchased through an employee stock option plan. If the transaction is completed within 30 days of the exercise of the option, then the stock can be donated with the gain intact and the donor can take advantage of the existing tax incentive.