How we help
- Donation of publicly-traded securities (zero inclusion on gain)
- Private foundation establishment and operation
- Donor-advised funds at community foundations
- Corporate vs. personal donation receipts
- Gift planning around a business sale or windfall
- Bequest planning in the will + life-insurance gifts
- Cultural-property gifts and ecological-gift programs
Three tax benefits at once
A donation of publicly-traded securities to a registered charity in Canada produces three coordinated tax benefits:
- The accrued capital gain on the donated security is excluded from taxable income under paragraph 38(a.1) of the Income Tax Act — a zero inclusion rate instead of the usual 50%.
- The donor receives a charitable-donation tax credit based on the fair market value of the donated security (15% federal on the first $200, 33% federal above for taxpayers in the top bracket, plus provincial credits).
- The corporation (if it's the donor) gets a deduction rather than a credit, which can be more valuable in certain situations.
For a donor sitting on appreciated public-company shares, gifting the shares directly to a charity is materially more tax-efficient than selling the shares and donating the cash. The accrued gain is sheltered entirely; the donation credit is the same in both cases.
Private foundations
A private foundation is a registered charity controlled by a single donor or family. Once established, the foundation receives donations from the donor (producing donation tax credits in the donor's hands) and disburses grants to public charities over time at the foundation's pace. The donor retains control over the foundation's grant-making and investment decisions, subject to the CRA's disbursement-quota and prohibited-investment rules.
Private foundations are typically worth establishing when the planned giving exceeds roughly $1M-$2M of total lifetime gifts. Below that threshold, a donor-advised fund at an existing community foundation usually offers similar control with lower administrative cost.
Gift timing around a windfall
A donor who will have an unusually high tax year — sale of a business, year of an estate freeze trigger, post-IPO liquidity event — can shelter much of the year's tax with a large donation. Donation credits are eligible to be carried forward for five years, so the donor can claim a portion in the windfall year and the balance over the subsequent years. The match between gift size and expected tax is a planning calculation.
For donors approaching a planned business sale, gifting QSBC shares to a private foundation before the sale (rather than gifting the cash proceeds after) can produce additional tax benefits — the donor avoids the gain on the donated portion and the foundation receives the FMV.
Corporate vs. personal donations
Corporations receive a deduction rather than a credit, valued at the corporate tax rate (currently ~26.5% combined in Ontario at general rates). Personal donation credits in the top bracket are roughly 50% combined federal + provincial — a higher rate than the corporate deduction. For an owner-manager, donating personally rather than through the corporation usually produces a better after-tax result.
An important exception: when the donation is made from a private foundation that's funded by the corporation, the corporate donation can produce a capital dividend account (CDA) credit for the non-taxable half of the donated capital gain, which the corporation can later distribute as a tax-free capital dividend to the shareholder. The integration of the foundation, the corporation, and the personal tax position is a planning calculation.
Bequests and life-insurance gifts
Donations made by will are claimable on the estate's terminal T1 (or carried back to the prior year), often producing a large credit just when the estate has its biggest tax bill. Life-insurance gifts — where the charity is the beneficiary of a policy on the donor's life — produce a credit equal to the death benefit on the donor's terminal return, with the policy premiums often paid by the donor over their lifetime to lock in the future credit.
Cultural property and ecological gifts
Two specialized regimes provide enhanced benefits:
- Cultural-property gifts — works of art and other items certified as cultural property by the Canadian Cultural Property Export Review Board produce a donation receipt at FMV with zero capital-gains inclusion on the gain.
- Ecological gifts — gifts of ecologically-sensitive land or conservation easements produce enhanced tax credits and zero capital-gains inclusion.
How we work the file
Most charitable-giving engagements at Barrett Tax Law sit alongside a broader business-or-estate plan. We model the alternative donation structures, draft the corporate or foundation documents, coordinate with the chosen charity on the gift mechanics, and handle the CRA registration if a private foundation is being set up. Fees are typically fixed for the structuring phase.
What to expect when you call us
Your first call is a free, no-obligation consultation with a tax lawyer. We will review the details of your situation, explain your options under the Income Tax Act and CRA administrative practice, and give you a clear, fixed-fee quote if you choose to retain us. Your consultation is confidential, and once we are retained, communications are protected by solicitor–client privilege.
If you retain us, we begin work within 24 hours of being retained.
Frequently asked questions
Is the consultation really free?
Yes. Most cases qualify for a free, no-obligation consultation with one of our tax lawyers. During the call we'll review your situation, explain your options, and give you a clear quote if you decide to retain us.
What does a tax lawyer do that an accountant does not?
A tax lawyer focuses on the legal side of tax — disputes, litigation, and the structuring of transactions in light of the law and anti-avoidance rules. That includes representing taxpayers in CRA audits and objections, appearing at the Tax Court of Canada, defending penalties and director or derivative liability, and designing reorganizations such as section 85 rollovers and estate freezes.
The most practical distinction is privilege. Communications with a lawyer are generally protected by solicitor-client privilege, while communications with an accountant generally are not and can be demanded by the CRA. Where the facts are sensitive or the matter could become contentious, that protection matters.
Lawyers and accountants often work together — the accountant on the numbers and filings, the lawyer on strategy, privilege, and the legal record. Barrett Tax Law regularly coordinates with a client's existing accountant.
Do you serve all of Canada?
Yes. Barrett Tax Law represents clients across Canada. We have offices and local phone lines in Toronto, Calgary, Edmonton, Fort McMurray, Ottawa, Vancouver, and Winnipeg, plus a national toll-free line at 1-877-882-9829.
Who is Barrett Tax Law and what areas does the firm handle?
Barrett Tax Law is a Canadian boutique tax law firm that represents individuals and businesses in their dealings with the Canada Revenue Agency. The firm's work spans CRA audits and disputes, voluntary disclosures, Tax Court of Canada litigation, collections matters, and corporate and estate tax planning.
The firm was founded in 2009 and has represented many thousands of clients across Canada. Its head office is in Concord, Ontario (Vaughan), and it serves clients nationwide. You can reach the firm toll-free at 1-877-882-9829 (1-877-8-TAXTAX).
Most matters qualify for a free, no-obligation consultation, and most are quoted on a fixed-fee basis once scope is understood, so the cost is known before work begins.
What does a tax lawyer do that an accountant cannot?
Accountants prepare returns and financial statements. Tax lawyers represent you when those returns are challenged, audited, or prosecuted — and our communications are protected by solicitor–client privilege, which accountant communications generally are not.
What should I do if I receive a letter from the CRA?
First, identify what the letter is and what it requires. A CRA letter may open an audit, ask for documents, propose adjustments (a proposal letter), confirm a reassessment, or start collection action — and each carries its own deadline and its own implications. Note any date by which a response is required.
Do not ignore it, and be careful about responding off the cuff. What you say and produce can shape your later objection and appeal position, and casual admissions can be difficult to undo. If the letter proposes adjustments or penalties, or if significant amounts are involved, get advice before responding.
A free consultation can help you understand the letter, the deadline, and the right next step. Acting early — while options are still open — is usually far better than waiting until a deadline is near.
Will the CRA criminally prosecute me?
Most CRA disputes are civil. Criminal prosecution is reserved for serious tax evasion or fraud, usually involving deliberate misrepresentation. If you have unreported income, a voluntary disclosure is one of the standard ways to reduce criminal-prosecution risk.
Is the first consultation really free?
Yes. Most matters qualify for a free, no-obligation consultation with an experienced tax lawyer. The consultation is a chance to describe your situation, get a clear sense of the options and likely path, and receive a fee structure in writing before you commit to anything.
You can reach the firm toll-free at 1-877-882-9829 (1-877-8-TAXTAX) to arrange a confidential consultation. The head office is in Concord, Ontario (Vaughan), and the firm serves clients across Canada.
Are my communications with a tax lawyer confidential?
Yes. Communications between you and your lawyer for the purpose of obtaining legal advice are generally protected by solicitor-client privilege, one of the most strongly protected confidences in Canadian law. In practical terms, the CRA generally cannot compel disclosure of privileged communications.
This is an important difference from working with an accountant or other non-lawyer representative, whose communications and working papers can generally be demanded by the CRA. Where the facts are sensitive — unreported income, offshore assets, or potential penalties — that protection can be significant.
Privilege has limits and can be waived inadvertently, so it should be handled with care. A consultation can explain how privilege applies to your particular situation.
How fast can you start on my case?
We typically begin work within 24 hours of being retained. For audit deadlines, Notices of Objection, and other time-sensitive matters, we move immediately.
What if I have unfiled tax returns from many years ago?
We routinely handle 5+ years of unfiled returns. Through the Voluntary Disclosures Program — applied for before the CRA contacts you — we can usually eliminate gross-negligence penalties and limit interest exposure.