It’s probably not news to most of you that charitable giving in Canada attracts tax breaks that reduce your tax owing to the CRA. It’s a nice deal — support the causes that are meaningful to you while saving a bit of tax owed.

But for those of you with non-registered accounts holding stocks and ETFs, did you know there’s even a better option that can save you even more tax? By donating shares in-kind to your chosen charity, you get the same donation credit AND you avoid paying capital gains tax on the shares donated!

The differences can be sizeable depending on the unrealized capital gains you have in your portfolio.

Here’s a quick example: let’s say I bought $10,000 of XGRO¹ 5 years ago in my non-registered account. Per this dividend calculator featured in “Tools I Use” I see that it’s currently² worth $15,850.

Say I want to donate $1000 to a charity — selling $1000 of XGRO today would generate a capital gain of $369. That’s taxable at 22.48% marginal rate in Ontario in 2025³, so I have to pay an additional $83 in taxes⁴.

If I instead donate the shares in kind to the charity, I pay nothing on the capital gain, and I keep $83 either for me, or for additional charitable works.

So how do you do this? Well, it will depend on the online broker you deal with, but generally the steps are something like:

• Let the charity know you’re intending to do this. Larger charities will have a published process, for example the Ottawa Food Bank’s is here⁵. Smaller charities can still benefit if you use a service like CanadaHelps⁶.
• Let your broker know your intent. Every broker will have a different process, usually including some kind of form. Here’s some examples I found:⁷
  • QTrade: Voluntary Donation to Charitable Organization
  • Questrade: form
  • Wealthsimple: Process
  • BMO Investorline: form

And that’s it. The receiving charity will issue a donation receipt reflecting the market value of the donated securities for your tax filing. The nullification of the capital gain is done using form T1170⁸ when it comes time to file your taxes.

I plan to do this more systematically for the charities I support; it’s admittedly a bit more effort than automated contributions. Since Questrade (my current broker) charges me $25 every time I do this, I’ll have to be a bit more strategic about amounts and timing.

1. XGRO is a significant part of my portfolio, and as such it is included in my ETF all-stars page. What is also true is that I don’t hold much of it in my non-registered portfolio, but that’s just a historical investing habits showing up. ↩︎
2. 5 year return, WITHOUT dividends reinvested as of July 17, 2025. Not reinvesting the dividends means my cost base is clearly $10k, useful for the example that follows. ↩︎
3. Per https://www.taxtips.ca/taxrates/on.htm for taxable income between $114k and $150k. Don’t forget that capital gains are only taxed at 50% of the value of the gain. ↩︎
4. Ignoring the tax savings generated by the charitable donation in the first place since that’s the same in both scenarios. ↩︎
5. Googling “donate securities” <charity name> is helpful ↩︎
6. They do keep a portion of the donation to offset their expenses, so it may not be a good idea for small donations. ↩︎
7. Sorry Scotia iTrade users, I did my best but could not find their form. Let me know if it’s available somewhere and I’ll update. I’ve successfully used the process with both BMO and QTrade. ↩︎
8. i’m not an accountant. Consult a professional if you have concerns. ↩︎