Your will is the ultimate last word. Your will is your last communication with your descendants and beneficiaries and your opportunity to leave clear instructions on what you want done with your assets, how you want your final wishes to be carried out and what legacy you want to leave.
You are the most familiar with your family as well as with your own holdings and assets. Therefore you, and not the government or the courts, are in the best position to decide on the best way to take care of your family when you are no longer able to do so.
In order to make sure that your estate is dealt with properly and your family is adequately provided for, you should leave a carefully and diligently-devised estate plan. Once you ensure that your dependents are taken care of, you may also want to consider making a philanthropic bequest. Charitable giving will leave a lasting legacy.
While the reasons for charitable giving are many and varied, no one will shy away from the possibility of gaining tax benefits. For tax purposes, you are deemed to dispose of your assets immediately before your death at their fair market value. This deemed disposition will have tax repercussions, for example, capital gains.
If you decide to make a charitable donation to a Canadian registered charity or another qualified donee through your will or estate plan, you may be entitled to a charitable donation tax credit which can offset the taxes payable by your estate. This kind of planning can help alleviate the tax burden to your estate, leave more for your descendants to inherit, and provide a benefit to your community.
If you wish to leave a charitable gift as part of your estate plan, there are many methods and tools; you could leave a cash gift, donate your RRSPs or life insurance proceeds, donate shares or even set up a foundation, a scholarship or a trust. If there is a charity or an institution that you want to benefit, they may already have a simplified process in place to make your contribution easier.
Consider some local examples:
- Central Okanagan Foundation – they help you set up a memorial Endowment Fund to support local charities
- The Kelowna General Hospital Foundation – they have a list of online resources, including bequest wording for your will
- The University of British Columbia Okanagan – they also have a system in place to help you set up memorial scholarships
Your charitable gift can be given outright and the use of the funds will be at the full discretion of the charity. Alternatively, you can give for a specific purpose that is particularly meaningful to you. Regardless of what you choose to do, you must make certain that your instructions are clear. You want to avoid the headache, and potential legal disputes, that your estate and family could face if there is any uncertainty around the charity you’ve named and who you intended to benefit.
Regardless of your ultimate goals, you will want to use the proper tools to achieve your last wishes. By working with your tax, financial and legal advisors you can develop an estate plan that will meet all of your goals; providing for your family, leaving a lasting legacy, and minimizing the taxes that your estate will have to pay.
The information provided above is for educational purposes only. This information is not intended to replace the advice of a lawyer or address specific situations. Your personal situation should be discussed with a lawyer. If you have any questions or concerns, contact a legal professional.