Professional Advisors

• Top 10 Reasons
• Asking The Giving Question
• The Life Stages of Giving
• Gift Planning Matrix
• Glossary of Terms
• Frequently Asked Questions
• Ask a Local Expert
• Estate Gifts by Will
• Gifts of Life Insurance
• Outright Gifts

Professional Advisors Section

Gift Planning Matrix

Moving through life, your clients’ lifestyles and financial circumstances change. And so do the ways they might choose to support their favourite charities and not-for-profit organizations.

Type of Gift		Benefits to Charitable Organizations		Benefits to the Donor		Acceptable Assets		Most Appropriate For
Outright Gift of Cash		Immediate Use Liquid No risk		Donation receipt for full amount Straight forward transactions Satisfaction of seeing gift at work today		Cash Cheque Pre-Authorized Contributions (PAC), usually paid monthly		Available for immediate useImmediate Use Liquid No risk
A Gift of Publicly Listed Securities (including segregated & mutual fund units)		Immediate Use Liquid Little risk Generally simple and low cost to implement		Donation receipt for fair market value Only 25% of gain taxed if gift to a public charity (50% if to a private foundation) Satisfaction of seeing gift at work today		Stocks Bonds Mutual Fund Units Employee Stock Option Shares		Owners (any age) of stocks, bonds and other securities who can afford to give the asset and the interest or dividends it earns
Life Insurance Policy (Charity named as owner and irrevocable beneficiary)		Immediate access to cash value, assurance of death proceeds if policy retained (Term policies are often not retained as donor gets older)		Donation receipt for cash value and any future premiums paid Small current outlay leveraged into larger future gift		Any whole life policy (participating or universal) Term policy (personal)		Persons (generally ages 30- 60) who i) have an older policy no longer needed, or ii) want to make a large gift but have limited resources
Life Insurance Policy (charity named as beneficiary but not owner)		Will receive death proceeds unless donor changes beneficiary designation		Satisfaction of providing a future gift while retaining full control of policy Donation receipt to estate for full value of death proceeds		Any type of life insurance policy		Persons (any age) whose personal needs and family situation may be subject to change
Bequest of Retirement Plan Accumulations		Future gift provided beneficiary designation(s) and/ or bequest wording are not changed		Satisfaction of providing a possible future gift while preserving personal security Gift receipt that offsets tax on distribution of retirement funds		Registered Retirement Savings Plan (RRSP) and Registered Retirement Income Fund (RRIF) accumulations		All individuals, but especially single persons, and surviving spouses who have made other provisions for heirs
Bequest by Will		Expectancy of future gift provided that bequest wording is not changed		Satisfaction of providing for future gift while retaining full control of property Donation receipt for use with final income tax return For bequest of listed securities, 25% of gain taxable, for other property 50% , but tax credit on gain, likely resulting in tax savings to estate.		Cash, securities, real estate, tangible personal property		All individuals (any age) , but especially older persons with few or no heirs
Shares in a Privately- Owned Corporation		Share may pay dividends Charity may be able to sell shares in near term, or may hold them for an indefinite period		Donation receipt for appraised value, issued immediately (if gift to public charity) . Donation receipt of lesser of selling price and transfer value, issued when shares are sold (if gift to private foundation) 50% of gain taxable, but donation tax credit will exceed tax on gain		Shares held in privately- owned corporation		Entrepreneurs who are philanthropic Venture philanthropists
Outright Gift of Real Estate		Proceeds available as soon as property is sold Sometimes property itself can be retained and used Valuation and ongoing maintenance considerations can add complexity to gift administration		Donation receipt for fair market value (FMV) determined by appraisal 50% of gain taxable, but tax credit will exceed tax on gain, resulting in net tax savings		Real Estate		Owners (generally over 50) of a principal residence or investment property who do not need the property or the proceeds from its sale
Outright “In- Kind” Gift of Tangible Personal Property (other than cultural property)		Can be retained or sold and proceeds used for current needs Decisions to retain assets warrant careful consideration, in light of implications for valuation and usefulness for charitable purposes		Donation receipt for fair market value determined by appraisal 50% of gain taxable, but tax credit will exceed tax on gain, resulting in net tax savings Satisfaction of seeing gift at work now or in near term		Artworks, furniture, equipment, collections, automobiles, musical instruments		Owners (generally over age 50) of objects which they no longer intend to use
Charitable Remainder Trust (CRT)		Irrevocable future gift of remaining principal While often complex to administer, can be a highly effective gift planning instrument in selected circumstances		Net income from property for life or a term of years Donation receipt for present value of the remainder interest Property not subject to probate		Cash, securities, real estate		Persons (generally over age 60) who want to make a future gift and obtain present tax relief but want to preserve investment income for themselves and/ or a survivor
Gift of Residual Interest in real estate or artworks		Irrevocable future gift of property		Ability to continue using property for life or term of years Donation receipt for present value of residual interest Avoidance of tax of a portion of capital gain if donor retains life interest Property not subject to probate		Principal residence, other real estate, artworks		Persons (generally over age 60) who otherwise would give the property under their will
Outright Gift of Certified Cultural Property		Immediately added to collection and available for display or exhibition		Donation receipt for fair market value determined by appraisal 100% contribution limit No tax on capital gain Satisfaction of preserving property of national significance		Artworks, collections, artifacts or historic structures certified by Cultural Property Review Board (CPRB)		Owners (generally over age 50) of cultural treasures who would like to preserve the property within Canada
Interest-free Loan (normally payable on demand)		Provides capital for building or investment without interest cost Public Foundations (like community foundations) not currently eligible for these gifts due to debt restrictions under the Income Tax Act		Principal is recoverable Interest earned on loaned funds not taxable to donor Satisfaction of helping charity today		Cash and cash equivalents		Persons (any age) who have more than enough current income but want to preserve all principal for their own future security and/or heirs
Charitable Gift Annuity (self- insured) 1		Irrevocable gift of whatever principal remains after making required payments		Guaranteed life payments, all or substantially tax-free A donation receipt for a portion of contribution		Cash or marketable securities		Oldest donors (usually 65 and older) who want the security of guaranteed income payments
Charitable Gift Annuity (reinsured) 2		Irrevocable gift of that portion of the contribution retained after purchasing commercial annuity				Cash or marketable securities		Oldest donors (usually 65 and older) who want the security of guaranteed income payments

1. Note: Only charities designated as charitable organizations (i.e. not public or private foundations) and authorized under provincial law, may currently issue gift annuities.

2. Note: Currently public and private foundations, including Canada's Community Foundations, may not reinsure gift annuities.

Source: Minton & Somers, Planned Giving for Canadians (Adapted and revised)