Gifts of Stock, Bonds and Securities

Donating publicly traded stock and securities is a tax-smart way to support Trinity College. You will receive a tax receipt for the full appreciated value of a donation of publicly traded stock or securities and you will not be subject to any capital gains tax.

Eligible securities include shares, debt obligations or rights listed on a prescribed stock exchange, a share of the capital stock of a mutual fund corporation, a unit of a mutual fund trust, an interest in a related segregated fund trust or a prescribed debt obligation.

The simplest way to make your gift of stock or securities is to have the shares
electronically transferred from your account to Trinity's account. Staff in the Office of Development & Alumni Affairs will help guide you through the process and provide any necessary information. The receipt value will be based on the closing trading price on the day Trinity College receives delivery of the shares. As with any gift, you may designate the use of the value of the securities or leave the gift unrestricted.

The benefits of making a gift of stock or securities:

  • Capital gains tax on publicly listed stocks and securities are exempt when you donate your shares to Trinity College rather than selling and donating the proceeds (see example below).
  • The value of your tax receipt will be based on the market closing price on the day Trinity takes legal receipt of your stock or securities into our brokerage account.
  • You may claim charitable donations up to 75 per cent of your net income, and a five year carry-forward on any unused donation amount is permitted.

Example of the exemption of capital gains tax on gifted securities:

Ms. Donor decided to support Trinity College with a gift of $100,000. When reviewing whether she should sell her shares in a publicly-listed corporation and then donate the cash proceeds or donate the shares directly, Ms. Donor learned that she would have a greater net tax benefit by donating the shares directly to the College. The chart below assumes a tax rate of 50 per cent.

 

Sell Shares & Donate Cash

Donate Shares Directly

Fair market value

$100,000

$100,000

Cost basis

$20,000

$20,000

Capital gain

$80,000

$80,000

Taxable gain

$40,000

$0

Tax credit (at 50 %)

$50,000

$50,000

Tax on gain (at 50%)

$20,000

$0

Tax savings

$30,000

$50,000

For more information, please contact Michael Page at 416-946-7426 or m.page@utoronto.ca

An information kit on making gifts of stock and the related notification forms can be forwarded to you or your broker.

This information is general in nature, does not constitute legal or financial advice and should not be relied upon as a substitute for professional advice.  We strongly encourage you to seek legal, estate planning and/or financial advice before deciding upon your course of action.