Charitable Giving Through Your Corporation

In short

A corporation gets a deduction for donations. An individual gets a credit. Which is worth more depends on your tax rates.
Donating listed securities directly removes the capital gains tax and adds the whole gain to the capital dividend account.
Life insurance can turn modest annual premiums into a large gift, at death or sooner.

Three ways to give

What you give	What happens
Cash from the corporation	The corporation deducts the gift from its income, up to 75% of net income, with unused amounts carried forward five years
Publicly listed securities, given directly	No tax on the capital gain, a deduction for the full market value, and the entire gain is added to the capital dividend account
Life insurance	The corporation owns a policy and gives the proceeds, or the charity owns the policy and the premiums are the gift

A simple example

A holding company owns shares it bought for $40,000 that are now worth $100,000. If it sells them and donates the cash, half of the $60,000 gain is taxed first. If it donates the shares directly:

The charity receives $100,000.
The corporation pays no tax on the $60,000 gain.
The corporation deducts $100,000 as a donation.
The full $60,000 gain is added to the capital dividend account and can be paid to the shareholder tax-free.

Giving with insurance

There are two common designs. In the first, the corporation owns a policy and its will or directors direct the proceeds to a charity at death. The corporation gets the donation deduction then, and the capital dividend account is credited. In the second, the charity owns the policy and each premium the corporation pays is a donation in that year.

The first keeps control and flexibility. The second gives tax relief now. Which is better depends on whether the deduction is more useful today or to your estate.

Before a business sale

The year you sell a business is often the year with the largest tax bill of your life. A donation in that same year offsets income when your rate is highest. A donor-advised fund lets you make the gift in that year and decide which charities receive it over time.

Do I have to give away a lot for this to matter?

No. The securities example works at $10,000 as well as at $100,000. What matters is that you were going to give anyway. None of these structures leaves you with more money than not giving at all. They make the gift cost less, or let the same cost fund a larger gift.

Who it fits, and who it doesn't

A reasonable fit if

You already give, or plan to, and hold investments in a corporation
Your corporation owns listed securities with large unrealised gains
You expect a high-income year, such as a business sale
You want to leave a legacy gift without reducing what your family receives

Probably not for you if

You're giving mainly for the tax result: the tax saved is always less than the gift
Your corporation has little taxable income to deduct against
The investments are in private shares or real estate, where the rules are less generous

Run your own numbers

Estate Tax Exposure Calculator. Estimate the tax bill your estate could face on your corporation at death.

Open the calculator

Questions to ask your accountant

Is a donation worth more made personally or through my corporation this year?
Which holdings have the largest gains relative to their value?
How would a gift of securities change my capital dividend account?
If I'm selling the business, can a donation be timed in the same tax year?

Related guides

Figures are current as of 2026 and are general information, not tax, legal or investment advice. Rules and rates change, and how they apply depends on your facts. Confirm anything here with your accountant before acting. Dundas Wealth is an insurance brokerage (Dundas Life Inc., FSRA #37628M). We are paid by the insurance carrier if and when a policy is placed.