It's a winning combination. By donating your appreciated asset before the sale - rather than selling first and then donating the proceeds - less money goes to the government in taxes, more money goes to the charities you care about, and more money stays in your pocket.
You get a larger charitable tax credit on your income taxes (which saves you money personally), and you avoid paying capital gains taxes (which sends more money to charity, rather than the Canadian government).
*Due to provincial variances and the complexity and individuality of specific tax situations, and because this illustration is for educational purposes only, the tax rates for selection represent the low, medium and high ranges.
Note: The annual limit for claims in respect of charitable donations is generally 75% of net income for the year. This limit is increased to 100% in the year of death or the year prior.
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|Selling first, then giving||Giving before the sale|