Donating public securities is a tax-smart way to support the University of Waterloo. Gifts of securities include publicly traded shares, bonds and mutual funds can be made by your estate or during your lifetime. A gift of publicly traded stocks and securities can result in favourable tax credits.
Benefits of gifts of stocks and securities
- You can make a significant gift without having to pay capital gains on the appreciated value.
- When shares are donated directly, you receive a tax receipt for the fair market value on the day the shares are received by the University of Waterloo.
- These gifts have lower tax costs than if you were to sell the securities and then donate the proceeds.
How does this type of gift work?
Example: You make a gift of publicly traded shares that were purchased for $10,000 and are now worth $50,000.
Note: table is accurate as of Nov 2023
The below table uses general figures for the purpose of illustration. This example assumes you have a combined federal and provincial marginal tax rate of 53.53 per cent (varies by province), and you have made other charitable contributions exceeding $200 in the current year.
| VALUE OF SHARES | SELL THE SHARES (NO DONATION) | SELL THE SHARES AND DONATE THE PROCEEDS | DONATE THE SHARES |
| Value | $50,000 | $50,000 | $50,000 |
| Original purchase price | $10,000 | $10,000 | $10,000 |
| Capital Gain | $40,000 | $40,000 | $40,000 |
| Taxable gain (line 3 x 50%) | $20,000 | $20,000 | $0 |
| Donation receipt | $0 | $50,000 | $50,000 |
| Donation tax credit (calculated at 53.53%) | $0 | $26,765 | $26,765 |
| Tax on taxable capital gain (line 4 x 53.53%) | $10,706 | $10,706 | $0 |
| Net tax savings (line 5 – line 6) | $0 | $16,059 | $26,765 |
The information within these pages does not constitute legal or financial advice. We strongly encourage you to seek professional legal and/or financial advice for your particular situation.
For more information, contact our Planned Giving team at 519-888-4567 ext. 41879 or plannedgiving@uwaterloo.ca