Gifts of Cash

If individual donors wish to liquidate assets?and make?a cash gift, the possibility of gifting the asset rather than cash should be considered. There may be tax advantages, particularly with appreciated securities and possibly with other types of assets as well.

With a gift of cash, the donor receives an income tax credit (for corporations a deduction is claimed) for all amounts up to 75% of net income as defined in the Income Tax Act. For amounts over $200, the donation reduces tax liability at the full marginal tax rate.

The donor may carry excess donations (those not claimed in the current tax year) forward for five taxation years.

In many cases, retired or self-employed persons can obtain immediate benefits by reducing quarterly tax installments. Employed persons may obtain immediate authorization to reduce employer income tax withholdings.

Since this gift is made prior to death, it does not form part of the ??Estate?? and is therefore not contestable and does not attract various estate settlement fees.

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