The Tax Benefits of Planned Giving in Newfoundland and Labrador. Thank you to guest author, Edward Martin of Caritatis Wealth Management

As many of us begin to contemplate the old adage about “death and taxes,” our thoughts may turn to our legacy, and we begin to contemplate the ways that we may give back some of the financial success which we have enjoyed in our lifetime. In pondering this we understand that in the course of our lives there are few of us who have not been touched by many institutions or causes, and now, as the years pass, we wonder how we can give something back. However, when contemplating leaving a legacy, thoughts often turn to family and how such a legacy might affect what one’s heirs will receive.

This idea that giving to an institution may decrease the about left for family members seems quite straight forward, does it not? Yet, as my colleague Mark Halpern, Canada’s planned giving “guru,” always says, “Most people don’t realize that they have three possible beneficiaries: the Canada Revenue Agency (CRA), family, and charity. They can choose two of them.”

“Most people don’t realize that they have three possible beneficiaries: the Canada Revenue Agency (CRA), family, and charity. They can choose two of them.”

Providing a legacy to your favourite cause doesn’t have to greatly diminish what your heirs may receive; in fact, you have the option to disinherit the tax man.

As governments continue to grapple with providing various social programs on their own, it will increasingly be up to donors to fill in the gaps. For example, while governments provide most of the funding for our health care, the cost of new medical equipment is often not included. It is up to the generosity of donors to cover this shortfall. Our Federal and Provincial governments are aware of this shortfall and have established various generous tax incentives to promote planned giving. In fact, due to these incentives, simply writing a “cheque,” as most Canadians do, is the least effective way to give to charity.

Many Canadians do not realise that they can greatly mitigate or even eliminate any estate taxes due through charitable giving. 

Many Canadians do not realise that they can greatly mitigate or even eliminate any estate taxes due through charitable giving. Due to these tax incentives, there are numerous strategies available that can significantly enhance the charitable donation, the tax benefit, or both. These strategies are varied and can utilize a number of financial instruments such as life insurance, stocks, private company shares, or registered assets like RRSPs or RRIFs. Each strategy is different, so coordinating with your financial advisors is critical, but we are happy to help you start this very important conversation.

To leave a planned gift to the Health Care Foundation, you can explore various charitable giving strategies that also offer tax benefits. Below are some brief, and generalised examples, in which these tools might be utilised.

• Charitable Giving: This involves donating to a charitable organization like the Health Care Foundation. You can make these donations during your lifetime or as part of your estate planning.
• Tax Benefit: Many charitable giving strategies offer significant tax benefits, reducing the amount of taxes owed by your estate and maximizing the value of your gift.
• Life Insurance: You can name the Health Care Foundation as a beneficiary of a life insurance policy. This ensures a substantial donation upon your passing, often with tax advantages for your estate.
• Stocks: Donating appreciated stocks can be a tax-efficient way to give. By transferring stocks directly to the Health Care Foundation, you can avoid capital gains taxes and receive a charitable tax receipt for the fair market value of the stocks.
• Private Company Shares: If you own shares in a private company, you can donate these to the Health Care Foundation. This can provide a valuable gift while offering tax benefits related to capital gains and other tax considerations.
• Registered Assets (RRSP or RRIFs): You can name the Health Care Foundation as the beneficiary of your Registered Retirement Savings Plan (RRSP) or Registered Retirement Income Fund (RRIF). This can help reduce the tax burden on your estate while supporting a cause you care about.

For more personalized advice and to discuss these options further, please contact Derrick Moore, Development Officer Health Care Foundation at (709) 777-1801.

About the Health Care Foundation
The Health Care Foundation raises funds to improve the delivery of healthcare in Newfoundland and Labrador’s adult hospitals and healthcare facilities in the St. John’s region, providing specialized and tertiary care for the entire province. We strive to advance and enhance innovation, medical equipment and next generation technology, support healthcare research and education, and patient comfort and care within adult hospitals and facilities for the people of Newfoundland and Labrador.

– 30 –

• Website: Health Care Foundation
• Click here to send us an email!
• Phone: (709) 777-5901