A will is a formal legal document in which you specify how you wish your property and assets to be distributed after death. Without a will, your lifetime accumulation of wealth will be distributed according to provincial laws, regardless of your intent. A well-prepared, up-to-date will is essential to ensure your future gift is exactly what you want it to be. Fortunately, making a Will is not complicated when it is done with legal assistance.
While making a gift in a will is the most common way to support charities through your estate plan, there are other types of gifts that may suit your needs and financial situation.
We encourage you to talk to your professional advisor and your charity of choice who can help you decide which option(s) will work best for you and your family.
Learn more about the various types of legacy gifts.
Providing for a charitable gift in your Will can easily be accomplished by including a bequest to the charity of your choice. "Bequest" is simply a term used to describe a gift in your will specifying that a certain percentage of your estate, a particular asset, or a specific dollar amount is to be directed to a named beneficiary.
While there are currently no estate or inheritance taxes in Canada, there are certain "deemed dispositions" and income taxes payable under the Income Tax Act that can create tax liabilities. A charitable bequest, however, can provide significant tax advantages to your estate.
When you make a bequest to charity, your estate is entitled to a gift receipt for the full value of the bequest. If the total bequest exceeds 100% of the net income on your final tax return, the excess may be carried back to the previous tax year.
A bequest can be for an unrestricted or designated gift in the form of cash, property or securities. It can also take the form of a "residual legacy" whereby a charity receives all or a portion of whatever remains of your estate after all debts, taxes, expenses and other bequests have been dispensed. Should you wish to make a bequest through your Will, you can contact a lawyer to assist you with the appropriate legal wording.