There’s an advantage to donating things other than money to your favourite charity or non-profit organization. One option is gifting stocks and securities in-kind. If you’re considering it, here are a few tips to get started:
- Make sure you understand the benefits. As a donor, the Canadian Revenue Agency does not apply capital gains tax on donations of publicly traded securities. For example, if you were to sell shares for cash, you are responsible for the tax on the capital gain. But if you donate securities, those capital gains aren’t subject to tax. This means you’ll receive a tax receipt for the full value of your stocks or securities.
- Let your broker know about your plans and ask them for advice — they are the experts.
- Make sure the charity of your choice has a stock-giving program. Each charity will likely have their own process, so make sure to get in touch with the appropriate coordinator. Your broker will be required to fill out the necessary paperwork to transfer your funds to the charity.
- Gifts of public securities must be donated in-kind. Make sure your broker does not sell securities before transferring to the charity of your choice.
- In-kind donations of stock typically take longer to process than regular donations, so make sure to give yourself enough time.