Gift of Shares

Favorable tax rules regarding the donation of shares to a registered charity make this option particularly attractive for many donors. When shares are donated to the STARS Foundation, a charitable receipt is issued for the fair market value of the gift. This is determined by the closing price on the date of the transfer to the STARS Foundation.
Your gift of shares provides an innovative and creative way to make a charitable gift and can often help fund a larger gift than you might otherwise be able to make. Shares include stocks, bonds, bills, warrants and mutual funds.

Gifts of publicly listed shares are becoming increasingly popular. In 2006, the federal budget provided Canadians with the largest charitable giving tax incentive in the last decade by eliminating the capital gains inclusion rate on gifts of shares to registered charities.

For example, let’s assume that you intend to make a gift of 1,000 shares that originally cost $50,000 and that the shares trade at $80 at the time of the gift. If the shares are sold and the proceeds are donated to a favorite charity, the net cost of the gift would be $6,000 greater than if the shares had been gifted directly to the charity (assuming a 40 per cent marginal tax rate; combined federal and provincial rates).

To illustrate the result, please see the following comparison:

Forms

Download the Transfer of Securities Form