RBC Wealth Management offers tips on charitable giving for challenging times
TORONTO, Nov. 26 /CNW/ - While the economy is showing signs of recovery, many Canadian families still face tough decisions about how to give as much as they would like by year-end. RBC Wealth Management offers practical advice on making your gifts go further.
"This holiday season, take a family approach to giving to get the most out of your donations," said Anthony Maiorino, Vice President, RBC Wealth Management Services. "Integrating your giving with your financial planning, tax management and family goals can significantly reduce the taxes you pay and increase the benefits for yourself, your family and the causes you support."
RBC Wealth Management's advice for making your gift go further:
1. Plan your giving as a family - Some families agree on a vision and
make a long-term commitment to support selected causes. Asking your
kids to help choose the causes can be a great way to teach them about
2. Give to a worthy cause in lieu of Christmas presents for adult family
members - Consider agreeing to donate the money you would normally
spend on a new sweater for your brother-in-law to a charity instead.
3. Establish your own charitable gift fund - A charitable gift fund
allows you to create a lasting charitable legacy without the time and
expense of a private foundation. A registered public foundation
administers the assets, but you can decide which charities receive
grants. Investment earnings in the fund grow tax-free and are
available to fund selected causes every year.
4. Check for donations unclaimed in previous years and combine tax
receipts with your spouse - Donations can be carried forward for five
years. If you make small annual gifts, consider carrying forward your
donations and then claiming the combined donations to benefit from
the higher tax credit for gifts over $200. Maximize your family tax
savings by claiming all donations on the higher-income spouse's tax
5. Donate depreciated securities to reduce your taxes - This could be a
good time to donate underperforming securities for a tax break. If
you donate a security in kind that has a capital loss, you can use
the loss to reduce your capital gains. After applying capital losses
against any capital gains in the current year, you can carry the
balance of the loss back three years or forward indefinitely to
offset capital gains in future years.
6. Give the gift of life ... insurance - Consider gifting a life
insurance policy. You are eligible for a donation receipt for the
fair market value of the policy when you transfer ownership to a
registered charity. While you will be taxed on any gain, it should be
offset by the donation tax credit, and in fact the credit may be
larger than the gain. If you are still paying the premiums after
ownership is transferred, you will get a tax receipt each year.
7. Designate a charity as a beneficiary on your RSP or RIF - This
strategy avoids probate taxes on your registered plan. In addition,
your heirs can claim a donation tax credit on your final tax return
to offset tax owed by your estate.
8. Donate through your company to get a tax-free dividend - For owners
of an incorporated business, a donation of publicly-traded securities
from the company may allow for a tax-free dividend to the owner
through the use of the Capital Dividend Account.
Consult with your financial advisor and a tax professional to determine whether these strategies are right for you.
RBC Wealth Management Services has a team of more than 80 financial planners, tax specialists, accountants, high-net-worth specialists, lawyers, will and estate planners and other professionals who work closely with advisors and clients across RBC channels to deliver a level of integrated wealth management that has traditionally only been available to the most affluent families.
About RBC Wealth Management
RBC Wealth Management directly serves affluent and high-net-worth clients in Canada, the United States, Latin America, Europe and Asia with a full suite of investment, trust and other wealth management solutions. The business also provides asset management products and services directly and through RBC and third-party distributors to institutional and individual clients, through its RBC Global Asset Management division. RBC Wealth Management has more than $490 billion of assets under administration, nearly $240 billion of assets under management and more than 4,500 financial consultants, advisors, private bankers and trust officers. RBC Wealth Management was recognized as the Outstanding Private Bank in North America by Private Banker International in October 2009.
For further information: For further information: Tanis Robinson, RBC Corporate Communications, (416) 974-1031; Matt Gierasimczuk, RBC Media Relations, (416) 974-2124