PearTree Canada: Where Finance Meets Philanthropy
GiveWise is pleased to introduce you to our friends at PearTree Canada. PearTree provides an advanced donations solution that allows donors to purchase shares of Canadian resource companies and donate them to a registered Canadian charity of their choice, reducing their taxable income, supporting non-profits, and accelerating the development of resource projects in Canada.
It’s a Triple Win!
A brief explanation, directly from PearTree’s website:
The Canadian Flow-Through Share tax regime was established in the 1970s to promote exploration investment in Canada. Resource issuers can “flow through” the tax deductions and credits associated with the issuers’ exploration activities to the first subscribers of these common shares. In 2007, PearTree developed the highly successful Flow-Through Share Donation Platform, resulting in increased & accelerated philanthropy and expanded value access for global investors.
Canadian tax authorities are fully onside with this structure. In over 15 years and over 500 financings and in thousands of client tax returns there has never been a single instance where the CRA or a provincial tax authority has questioned or challenged the appropriateness of this arrangement. Early on PearTree obtained Advance Income Tax Rulings from the CRA and Revenu Quebec in which the authorities confirmed the tax consequences. The Tax Rulings & Techical Interpretations can be found on PearTree’s website.
A simplified explanation of how it works:
- Donor subscribes to flow-through share issue, accessing tax benefits
- Donor gives shares to any registered Canadian charity of their choice
- Charity immediately sells shares to a pre-determined institutional end buyer, arranged by PearTree
- Charity receives funds and issues tax receipt to the donor
This process results in the donation costing the donor far less than a direct gift of cash to the charity. As we said at the top, it’s a triple-win!
If you have questions or would like to discuss further, please email dan.kyte@givewise.ca and he will be pleased to explain further and to put you in touch with the appropriate representative from PearTree.