Donating cash to the Diocese or a parish provides immediate funds for use by the Church, and you receive a tax receipt for the donation.
The donation receipt for your cash gift to the Church can be used to reduce the income tax you pay in the year you make the donation, and potentially in each of the next five taxation years (“unused donation credits”).
Because the income tax credit for donations can only reduce taxes payable, you should take care not to claim more of your charitable donation than the amount that can be used in one year, and carry forward any unused donation credits. In most cases, the maximum donation you can claim is equal to 75% of the your net income.
|Donation of Cash||Donation of Securities*|
|Income tax credit in donation||$9,200||$9,200|
|Tax saving due to tax exempt capital gain (up to approximately 23% of gain)||—||$2,300|
|Total tax savings||$9,200||$11,500|
|Net cost of donation||$10,800||$8,500|
* Click link to access information about donating securities
- The examples are based on a British Columbia resident donor.
- The lower tax credit rate on the first $200 of annual donations is covered by other donations.
- Federal and BC income tax credits are based on a 46% rate.
- Assuming value of securities at time of donation of $20,000 and cost of $10,000.
- Tax on capital gains is calculated at highest marginal income tax rate for illustration purposes (approximately 23% of gain).
Prior to making a donation or gift, we recommend that donors seek independent professional advice concerning the possible financial, taxation and legal consequences.