Making a gift of publicly traded securities, mutual funds or stocks is simple.

Sell shares and donate the gross proceeds
 Donate shares directly
Market value of security $10,000 $10,000
Cost base $5,000 $5,000
Capital gain $5,000 $5,000
Taxable capital gain (50%) $2,500  
Tax due on gain at 46% $1,150  
Tax receipt for gift $10,000 $10,000
Value of tax receipt at 46% $4,600 $4,600
Net tax savings $3,450 $4,600
Example uses Ontario federal and provincial combined tax rate.
  • Market value of security
  • Cost base
  • Capital gain
  • Taxable capital gain (50%)
  • Tax due on gain at 46%
  • Tax receipt for gift
  • Value of tax receipt at 46%
  • Net tax savings
  • Sell shares and donate the gross proceeds
  • $10,000
  • $5,000
  • $5,000
  • $2,500
  • $1,150
  • $10,000
  • $4,600
  • $3,450
  • Donate shares directly
  • $10,000
  • $5,000
  • $5,000
  •  
  •  
  • $10,000
  • $4,600
  • $4,600
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