Stocks and Securities
Individuals are exempt from capital gains taxes when they make a donation of appreciated stocks, bonds and mutual fund units.
When you give securities to the GBLT you will receive a tax receipt for income tax purposes for the full market value of the shares at the date of the transfer.
The following table is an example of how a gift of stock is more beneficial than selling the stock and donating the cash received.
|Sell shares & donate cash||Donate shares directly|
|Present value of shares||$100,000||$100,000|
|Purchase price of shares||$20,000||$20,000|
|Capital gain on shares||$80,000||$80,000|
|Taxable amount of capital gain||$40,000||$0|
|Tax payable* on capital gain||$18,000||$0|
|Tax credit on donation||$45,000||$45,000|
|Total tax saving||(Tax credit only) $45,000||(Credit plus tax saving) $63,000|
*For illustration purposes we have used an average marginal tax rate of 45%.