You care about a cause. You write a cheque, make an online donation or say yes when someone you know asks you to support a fundraiser.

That’s giving.

Charitable giving starts one step earlier and looks several steps further ahead.

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It asks what you want your money to accomplish, how much you can comfortably give, which assets make the most sense to donate and whether you want to help now, through your estate or through some combination of both, because a generous gift made without much planning can still be less effective than it should be.

The cause receives support either way.

But the structure matters.

Start with the cause, not the tax receipt

Decide what you want your giving to change

A tax credit is useful. It shouldn’t choose the charity for you.

Start with the work you care about, which may include health care, education, housing, the environment, arts and culture, faith, animal welfare or local organizations doing work close to home.

Then get more specific.

Do you want to fund urgent needs or long-term change? Do you prefer one meaningful gift or smaller gifts spread across several charities? Do you want your family involved? Does the charity need money now, or would a future estate gift have greater value?

These aren’t tax questions.

They’re personal questions, and you should answer them before anyone starts discussing donation strategies.

In 2023, just over five million Canadian tax filers reported charitable donations totalling $12.8 billion, an increase of 11.8% from 2022. The median claimed donation reached $390.

That’s a large amount of money moving toward charitable work, but a larger gift isn’t automatically a clearer one.

Your giving should have a reason.

Check the organization before you donate

Confirm that the organization is a registered charity if you expect an official donation receipt. Review what it does, how it reports its results and whether its work matches what you want your money to support.

You don’t need to turn every donation into a six-month research project.

You do need to know where the money is going.

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Cash is simple, but it isn’t always the best asset to give

Appreciated investments can change the tax result

Most people donate cash because cash is familiar.

You earn it. You give some away. The charity issues a receipt.

But when you own publicly traded investments that have increased significantly in value, donating the securities directly may produce a better tax result than selling them first and donating the cash.

A registered charity can generally issue a receipt based on the fair market value of publicly traded shares when it receives them.

Selling an appreciated investment can trigger a capital gain, while an eligible direct donation of publicly traded securities may receive more favourable capital-gains treatment.

You shouldn’t assume the more complicated option is always better, because transaction timing, investment concentration, available tax credits and the charity’s ability to receive securities all matter, but the question deserves more than an automatic cheque.

Don’t let the tax tail steer the entire decision

Tax planning can help you give more efficiently.

It doesn’t make the gift free.

You still part with an asset that had value to you, so the first question remains whether the gift fits your life and your financial plan.

A Victoria financial advisor should help you compare the options clearly, including donating cash, securities or other property, and should coordinate the strategy with your accountant where the tax treatment becomes more complex.

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You can give during your life, through your estate or both

Giving now lets you see what happens

A gift made during your lifetime can support work that matters today.

You may also get to meet the people involved, learn how the organization uses the money and involve your children or grandchildren in deciding which causes the family supports.

There’s something satisfying about seeing the impact while you’re still here.

Lifetime giving also allows you to adjust.

You can increase support when a charity does good work, change direction when your priorities shift or spread larger gifts across several years rather than leaving one final instruction in your will.

The best giving plan still feels like yours

Financial planning can improve how you give.

It can reduce avoidable tax, help you choose the right asset and connect your generosity with your retirement and estate plans, but the planning shouldn’t take over the point of the gift.

You’re giving because something matters to you.

Keep that part intact.

The numbers should help you make the gift larger, steadier or more useful without putting your own future at risk, and when the plan works well, you understand what you’re giving, why you’re giving it and what the decision means for everything else.

Not charity as an afterthought.

Not tax planning dressed up as generosity.

A deliberate act, properly built.

Frequently asked questions

How can a Victoria financial advisor help with charitable giving?

A financial advisor can help you decide how much to give, compare different assets, assess the effect on your retirement and estate plans, and coordinate the strategy with your accountant and lawyer.

Is it better to donate cash or investments?

Cash is simple, but directly donating eligible publicly traded securities may be more tax-efficient when they have increased significantly in value. The better choice depends on your investments, income and overall financial plan.

Do charitable donations reduce my taxable income?

Individuals generally receive charitable donation tax credits rather than a direct deduction from taxable income. The exact value depends on the amount donated, your province and other tax factors.

Can I leave money to a charity in my will?

Yes. You can leave a fixed amount, a percentage of your estate, a specific asset or part of the amount remaining after other gifts and expenses. Have a lawyer draft the wording clearly.

Should I tell a charity about an estate gift?

You don’t always have to, but informing the charity can help it confirm the correct legal name and ensure it can accept the proposed gift. You can ask the charity to keep your plans confidential.

How often should I review my charitable giving plan?

Review it annually and after major changes such as retirement, a business sale, an inheritance, a significant investment gain, a change in health or an update to your estate plan.