--- title: "Donate Personally or Through Your Corporation? Tax Compared" url: https://www.everstonecpa.com/blog/charitable-donations-personal-vs-corporate description: "Charitable donations personally or through your corporation: a personal gift earns a tax credit, a corporate gift a deduction. Compare the two." type: guide updated: 2026-10-06 summary: "A personal gift produces a non-refundable tax credit, while a corporate gift produces a deduction against corporate income. Which is better turns on the donor’s marginal rate, the corporation’s tax rate, and whether the money would otherwise have to be paid out as a taxable dividend first." faq_count: 6 publisher: EverStone CPA Inc., a Chartered Professional Accountant firm registered with CPA British Columbia and CPA Alberta service_area: British Columbia, Alberta, Ontario and Manitoba language: en-CA contact: info@everstonecpa.com · https://www.everstonecpa.com/book-online --- [Home](https://www.everstonecpa.com/) [Blog](https://www.everstonecpa.com/blog) Personal vs Corporate Charitable Donations Tax planning # Charitable donations: *giving personally versus giving through your corporation* By EverStone CPA · Updated July 2026 · 7 min read **Quick answer:** A personal gift produces a non-refundable tax credit, while a corporate gift produces a deduction against corporate income. Which is better turns on the donor’s marginal rate, the corporation’s tax rate, and whether the money would otherwise have to be paid out as a taxable dividend first. A credit and a deduction are not the same instrument. **Rather have a CPA handle this?** A CPA at EverStone replies with a straight answer and a fixed fee for your situation. [Get My Fixed Quote →](https://www.everstonecpa.com/book-online?service=personal#enquiry-form) ## Key takeaways - Individuals get a credit; corporations get a deduction. They are not the same instrument. - Both routes are generally limited to 75% of net income for the year, with unused amounts carried forward for five years. - Corporate giving avoids the step of extracting cash personally and paying tax on it first. - Donating publicly listed securities in kind has favourable capital gains treatment on either side. - Only gifts to registered charities and other qualified donees count, and the receipt must be in the donor’s name. ## Two different tax instruments The decision is often framed as a preference. It is really a comparison of two mechanically different reliefs. Donating personally earns a **non-refundable tax credit**: the lowest federal rate on the first tranche, a higher rate above it, and a further tier for top-bracket donors. Each province adds its own credit. Being non-refundable, it reduces tax payable but cannot create a refund. A corporate donation earns a **deduction** against taxable income, worth the corporation’s tax rate on that income. For a small Canadian-controlled private corporation taxed at the small-business rate, that rate is low, which is why the comparison is not obvious. **Deciding whether you or the corporation should donate?** We run both numbers at year-end and file the return that gets the better result, with personal returns from $125 and the T2 quoted in writing. See [our tax services](https://www.everstonecpa.com/tax-services), or [get a quote](https://www.everstonecpa.com/book-online?service=personal#enquiry-form). [Get My Fixed Quote](https://www.everstonecpa.com/book-online?service=personal#enquiry-form) ## The comparison that actually matters Compare the two on a like-for-like basis: the corporation has $10,000 of profit it wants to give away. **Route one, corporate gift.** The corporation donates the $10,000 and deducts it. Relief equals the corporate tax rate on that income. The owner receives nothing personally and no personal tax arises. **Route two, personal gift.** The corporation pays the owner salary or a dividend, the owner pays personal tax on it, then donates the after-tax amount and claims the credit. Salary is deductible to the corporation, so the corporate layer is neutral; with a [dividend](https://www.everstonecpa.com/blog/eligible-vs-non-eligible-dividends-canada), corporate tax is already paid. Roughly: personal giving tends to win for an owner in a high bracket, as the credit tiers approach the top marginal rate while the corporate deduction is worth the lower corporate rate. Corporate giving tends to win when the cash would stay in the company anyway, the owner has little personal tax, or the corporation earns general-rate income. Planning a large gift this year? Above a certain size the personal-versus-corporate answer flips, and gifts of securities change it again. Worth modelling before the cheque is written. [Send an Enquiry →](https://www.everstonecpa.com/book-online?service=personal#enquiry-form) [Tax planning](https://www.everstonecpa.com/tax-planning-services-canada) ## The limit and the carry-forward Both routes are capped at 75% of net income for the year, for individuals and corporations alike. Excess amounts carry forward five years, or ten for gifts of ecologically sensitive land. Some exceptions raise the ceiling to 100%: certain gifts of capital property, and gifts in the year of death, which can also be carried back a year. Plan around these rather than discovering them afterwards. ## Donating securities instead of cash The most tax-efficient gift is often not cash. Publicly listed securities with an accrued gain, donated in kind to a registered charity, get special capital gains treatment, and the donor still receives a receipt for full fair market value. Selling first and donating the proceeds loses that treatment. This works on both sides, but differently. When a corporation donates appreciated securities, the non-taxable part of the gain generally goes into the [capital dividend account](https://www.everstonecpa.com/blog/capital-dividend-account-explained), payable to the shareholder tax-free. A corporate deduction plus that addition is often the strongest case for giving through the corporation. ## The receipt and the receipt name The gift must go to a registered charity or other qualified donee, with the receipt naming the actual donor; a personal receipt cannot support a corporate deduction, or vice versa. This is the most common way a plan fails, since the decision is often made months after the cheque. The receipt must show the *eligible amount*: fair market value less any advantage received, such as tickets or meals. Charities must net this off, but check, especially for galas. ## Fitting it into the year For an owner-manager, giving is a cash-flow decision that belongs with the compensation plan. If the corporation is deciding [how much to distribute this year](https://www.everstonecpa.com/blog/leave-money-in-corporation-or-pay-out-canada), settle the donation route at the same time. At year end, time the gift into the fiscal period where the relief is worth more, as part of the [year-end checklist](https://www.everstonecpa.com/blog/year-end-tax-checklist-incorporated-owners). Sources - [Canada Revenue Agency — Donations and gifts: how much you can claim](https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-34900-donations-gifts/how-much-claim.html) - [Canada Revenue Agency — Line 34900, Donations and gifts](https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-34900-donations-gifts.html) - [Canada Revenue Agency — Charities and giving](https://www.canada.ca/en/revenue-agency/services/charities-giving.html) This article is general information for Canadian business owners and is current as of July 2026. It is not tax, legal or accounting advice, and it does not create a client relationship. Tax rules change and your situation is unique, so please [speak with a CPA](https://www.everstonecpa.com/book-online?service=personal#enquiry-form) before acting on anything here. About this article **EverStone CPA** Prepared and reviewed by a CPA at EverStone CPA, serving businesses in BC, Alberta, Ontario and Manitoba. [About the firm →](https://www.everstonecpa.com/about) · [Send an enquiry →](https://www.everstonecpa.com/book-online?service=personal#enquiry-form) ### Keep reading [The capital dividend account →](https://www.everstonecpa.com/blog/capital-dividend-account-explained) [Year-end tax checklist →](https://www.everstonecpa.com/blog/year-end-tax-checklist-incorporated-owners) [Leave it in or pay it out →](https://www.everstonecpa.com/blog/leave-money-in-corporation-or-pay-out-canada) [Separating Business and Personal Finances →](https://www.everstonecpa.com/blog/separating-business-and-personal-finances) FAQ ## Frequently asked questions about personal vs Corporate Charitable Donations **Is it better to donate personally or through my corporation?** It depends on your marginal rate and where the money sits. Personal giving tends to win in a high bracket; corporate giving when the cash is staying in the corporation anyway or the owner has little personal tax to offset. **How much can I claim in one year?** Generally up to 75% of net income, personally or corporately. Excess carries forward five years, or ten for ecologically sensitive land. Certain gifts of capital property and gifts in the year of death can be claimed up to 100%. **Do I get a deduction or a credit?** Individuals receive a non-refundable tax credit calculated at the lowest federal rate on the first tranche of gifts and a higher rate above that, plus a provincial credit. Corporations receive a straight deduction against taxable income, so the relief is worth the corporation’s tax rate. **Should I donate shares instead of cash?** Often yes. Donating publicly listed securities with an accrued gain in kind to a registered charity receives special [capital gains](https://www.everstonecpa.com/investment-income-and-capital-gains) treatment while still generating a receipt for full fair market value. Selling first and donating the cash does not get the same treatment. **Whose name should be on the receipt?** The actual donor’s. A receipt issued in your personal name cannot support a corporate deduction, and a receipt issued to the corporation cannot support a personal credit. Decide the route before the gift is made, not at filing time. **What is the eligible amount on a receipt?** Fair market value of the gift less any advantage received, such as event tickets or meals. The charity must net it off, so the eligible amount can be less than you paid. ## Giving through your business this year? Email us roughly what you plan to give and how you pay yourself. A CPA replies by email within one business day with which side should claim it and a fixed fee. [Get My Fixed Quote](https://www.everstonecpa.com/book-online?service=personal#enquiry-form)[Book a Paid Advice Call](https://www.everstonecpa.com/advice-call) ## Have a question about this? Ask free through [the quick-question form](https://www.everstonecpa.com/quick-question); a CPA replies by email within one business day. For a proper look, a 45-minute **Advice Call** with a Chartered Professional Accountant is $225 plus GST, credited to your first invoice if you become a client within 60 days. Want us to take it on? [Send an enquiry](https://www.everstonecpa.com/book-online?service=personal#enquiry-form). [Ask a Free Question](https://www.everstonecpa.com/quick-question) [Book a Paid Advice Call](https://www.everstonecpa.com/advice-call) Email info@everstonecpa.com ★★★★★ “Personal. Professional. Responsive. Plus he saved me a bundle!” Corrin Skalbeck · Google Local Guide **Run your own numbers with the free calculators:** [see which pay mix wins](https://www.everstonecpa.com/salary-vs-dividends-calculator) · [check when your T2 is due](https://www.everstonecpa.com/t2-deadline-calculator) · [Tax instalment calculator](https://www.everstonecpa.com/tax-instalment-calculator) [← Change in use rules: what happens when a home becomes a rental — or the reverse](https://www.everstonecpa.com/blog/change-in-use-rules-property-canada) [Chart of accounts that survives growth — and makes the T2 easier →](https://www.everstonecpa.com/blog/chart-of-accounts-small-business-canada) --- Source: https://www.everstonecpa.com/blog/charitable-donations-personal-vs-corporate Prices: https://www.everstonecpa.com/pricing · Contact: info@everstonecpa.com · https://www.everstonecpa.com/book-online