Gifts of Securities
Securities include stocks, bonds, bills, warrants, and futures traded on approved stock exchanges in Canada and certain other countries. They also include mutual funds.
Giving securities to the church has become a very popular way of making a gift in the last few years. This is largely because of changes to the Canadian Income Tax Act that have created large tax incentives to donors who give securities to their favourite charities.
Thanks to the Federal Budget of May 2, 2006, the capital gains tax on publicly listed securities has been eliminated for gifts to churches and charities. (Before May 2, the tax on gifts of securities was 25% of the gain, offset by a donation receipt if the securities were transferred to a church or charity)
You may be one of many donors who have highly appreciated stocks and mutual funds in your portfolio. In the past, many hesitated to give such assets to the church because of the tax payable on the capital gain. Now that the taxable gain on these assets has been eliminated , there is a strong incentive to give.
Or, you may own securities that you don't expect to perform as well as they have in the past and you may be thinking of selling them. You may be well advised, if you were planning a gift of cash to the church, to keep the cash and give the securities rather than sell the securities and give the cash proceeds.
And Now for a little twist….
Some donors resist giving large gifts of securities because it removes a significant asset from the estate that will then no longer be available to leave to their heirs. Did you know that some donors have creatively used the tax savings from this kind of gift to buy a life insurance policy on themselves as wealth replacement insurance?
The death benefit payout to the estate replaces the charitable gift of securities and the overall value of the assets of an estate remains unchanged. The donor receives the satisfaction of making a significant gift, the church receives that significant gift, and the heirs of the estate are protected financially.
The Diocese of Niagara has an account with
the Hamilton office of CIBC Wood Gundy to receive gifts of securities
on behalf of parishes, the ACM Foundation, or the diocese.
Hendershot EPC, CFP
It is our policy and also the policy of the Anglican Church Ministries (ACM) Foundation, unless otherwise instructed in unusual circumstances, to immediately sell any gifts of securities and invest the cash proceeds as directed by the donor.
For more information contact your Parish Planned Giving Representative
Mr. Carl Sneyd - 905 527 1316 ext 360 or click here to send an email.
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