GIFT OF SECURITIES

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Testimonials

I literally saved thousands of dollars on my taxes by donating my stocks directly to the Foundation.  It's easier than I thought.

Michael W.

A gift of publicly traded securities can provided you with the unexpected capacity to make a meaningful difference at OSMH. In 2006, the Government of Canada eliminated the capital gains tax on the donation of certain publicly-traded securities, including stocks, bonds, mutual funds, and exchangeable securities. This means that making a direct donation of securities to the OSMH Foundation is now the most effective way of minimizing taxes while also supporting the future of health care.

The Benefits

  • Capital gains tax on publicly listed stocks and securities are exempt when you donate shares to a registered charity
  • The value of your tax receipt will be based on the market closing price on the day the OSMH Foundation takes legal receipt of your stock or securities
  • You can support OSMH through an unrestricted donation, or designate your gift to a particular program or area of interest to you

How Does it Work?

Making a gift of securities to the OSMH Foundation is very easy.

    1. When you contact us about your gift, our staff will provide you with our ‘Gift of Publicly Listed Securities’ transfer form, which will help initiate the transfer of securities. Simply call the Foundation office at 705-325-6464. Alternatively, you can directly download the transfer form here.

 

    1. You will need to complete the form and submit it to your broker or financial advisor to initiate the process. Please also advise the OSMH Foundation of the pending transfer by forwarding a copy of this form to us. A copy of this completed and signed form is required to ensure timely processing of your gift and to issue a charitable tax receipt.
    2. You will receive a tax receipt based on the closing price on the date when the shares are transferred to the Foundation’s account.

Case Study

Here’s the difference between donating shares directly rather than writing a cheque after selling the shares. In this example, the donor is considering a gift of shares worth $25,000, with the original purchase price of $5,000. This donor makes $143,000 in income per year and as a result has a 46% marginal tax rate.

Sell and Then Donate Donate Securities Directly
Original Cost of Securities $5,000 $5,000
Current Market Value $25,000 $25,000
Capital Gain $20,000 $20,000
Tax on Capital Gains (Assuming marginal tax rate of 46%) $4,600 $0
Donation Amount (after tax) $20,400 $25,000
Charitable Tax Credit $9,384 $11,500

 

If the donor sells the shares then donates, they unnecessarily pay $4,600 to the tax man, and get a $9,384 tax credit. Alternatively, if the donor donates the shares directly to a charity, they pay $0 to the tax man and get a bigger tax credit of $11,500. Meanwhile, your charity of choice also receives a larger gift of $25,000.

This makes the most sense, especially if you are sitting on highly appreciated shares like Bell (BCE Inc.), Canopy Growth, Microsoft or Google where most of the sales proceeds could be capital gains.

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