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Stocks & Bonds

How Giving Securities Benefits You!

In May of 2006 the Federal Government created an incentive for you to give marketable securities to public charities like the Rotary Club of Gravenhurst. When you sell stocks, mutual funds, or flow through shares that have appreciated in value, you would be required to pay tax on 50% of the Capital Gain. The new legislation allows you to donate the securities and pay No Capital Gain! Rather than selling the security and giving the cash, the most cost effective and most beneficial tax advantage is to give the security. When donating stock to the Rotary Club direct them to the Rotary Bursary Endowment Fund if you want them to be used to benefit our students in the community.

Here is an example for you:

Sell shares and gift cash to charity Gift shares to any Charity
Proceeds of disposition (a)
$100,000 $100,000
Adjusted cost base (b)
(Original Price of Stock)
$20,000 $20,000
Capital Gain (c)
c = a – b
$80,000 $80,000
Tax on Capital Gain (d)
d = (c x 50%) x 46%*
$18,400 NONE: if donated to a  Registered Charity
Donation tax credit (e)
e = a x 46%*
$46,000 $46,000
Net tax savings from donation $27,600
($46,000 – $18,400 paid in tax)
($46,000 + $18,400 not paid in tax)


Benefits of Making A Gift of Securities

  • No Capital Gains
  • A Tax Receipt for the full market value of the security on the date received
  • Create a ‘Family Bursary’ within the Fund without being taxed
  • Leave a lasting Legacy of you, your family or someone special to you.

If you have any questions, please do not hesitate to Contact Us.