Over the last few years we have expressed caution over a series of donation tax shelters where the donor "made money" on the transaction. CRA has assessed many taxpayers who were involved. We have learned of a a new spate of assessments received by Montrealers recently. We expect these assessments to continue.
We are much more positive over a series of shelters which are being effected currently. They involve the purchase of mining flow-through common shares with a subsequent gift of these shares and an almost immediate sale by the charity of the shares. In short order the charity has the money, the donor obtains mining deductions and credits and donation credits. CRA has issued rulings on these shelters and have publicly expressed positive sentiments concerning them.
The cost of a donation
can be 8-10 cents
on the dollar.
Nothing is ever easy and we have some concerns over the complete value of the donation receipt.
The bottom line:
Donors must look at AMT issues and other concerns. But all in all this concept is very inviting. In essence when Finance eliminated the gain on a gift of marketable securities the natural choice was to find low ACB shares to gift. Mining shares of course have nil ACBs and so are very inviting. If you’d like to learn more, feel free to contact me.
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