Tax Benefits
Empowering Lives with Dignity and Independence
Charitable Giving
A Win-Win Strategy
Charitable giving not only supports meaningful causes—it also provides valuable tax benefits. The Canadian government encourages donations by offering generous tax credits, helping reduce the taxes you owe or increasing your refund.
Key points to know:
- Donations must be made to a Registered Canadian charity to qualify
- Tax credits reduce tax payable, not taxable income
- Donations by you and your spouse can be combined on one tax return
- Unused donations can be carried forward for up to 5 years (or claimed from the past 5 years)
- Donations are generally claimable up to 75% of net income (100% in the year of death and the year before)
Giving back creates impact—for the community and for you.
Giving back creates impact—for the community and for you.
| Donation Amount ($) | Tax Savings ($) Income $42,707 – $80,963 | Tax Savings ($) Income Above $80,963 |
|---|---|---|
|
$100 |
$20.05 |
$22.88 |
|
$200 |
$40.10 |
$45.76 |
|
$500 |
$160.58 |
$184.98 |
|
$2,000 |
$762.98 |
$881.10 |
|
$10,000 |
$3,975.78 |
$4,593.90 |
Donating Securities In-Kind
Donating Securities In-Kind
Donating publicly traded securities—such as stocks, bonds, or mutual funds—is often far more tax-efficient than donating cash. When you donate securities in-kind (instead of selling them first), you eliminate the capital gains tax that would otherwise apply, while still receiving a full charitable donation tax receipt for the fair market value.
The comparison below highlights the significant tax advantage of donating securities directly versus selling them and donating cash.
How Handi-Care Intl. Is Run
Tax Impact Comparison
| Scenario | Sell Securities & Donate Cash | Donate Securities In-Kind |
|---|---|---|
|
Market Value of Securities |
$100,000 |
$100,000 |
|
Adjusted Cost Base |
$(40,000) |
$(40,000) |
|
Capital Gain |
$60,000 |
$60,000 |
|
Taxable Capital Gain |
$30,000 (50%) |
0 (0%) |
|
Tax on Capital Gain (45%) |
A = ($13,500) |
0 |
|
Donation Tax Credit (45%) |
B = $45,000 |
$45,000 |
|
Net Tax Benefit (A+B) |
$31,500 |
$45,000 |
Donating Life Insurance
Donating Life Insurance
Donating through life insurance is a meaningful and tax-efficient way to make a significant charitable impact. You can purchase a new life insurance policy and name the charity as the beneficiary, allowing you to receive annual tax receipts for the premiums paid. Alternatively, you may transfer ownership of an existing policy to the charity, in which case you will receive a tax receipt for the policy’s cash surrender value at the time of transfer, along with annual tax receipts for any future premiums paid.
For those considering larger or more complex charitable gifts, life insurance can also form part of an effective tax and estate planning strategy. Since individual circumstances vary, it is recommended that you consult with your financial advisor, lawyer, or tax professional to determine the most appropriate approach—maximizing tax efficiency while supporting a cause that matters to you.
