You can make a larger gift than you might expect possible by naming the Anglican Church of Canada as the owner and beneficiary of a new or existing life insurance policy. By donating a life insurance policy, you can make a substantial gift to a ministry of your choice within the Anglican Church of Canada. This type of gift can provide immediate tax benefits to you, as well as tax relief for your estate.
There are many ways to make life insurance part of your lasting legacy:
Existing policy
If a policy you already own has outlived its original purpose (if, for example, your children have grown), do not cancel it – instead use it to help a ministry close to your heart by naming the General Synod of the Anglican Church of Canada as a beneficiary for a percentage or for the full amount of the policy. Your heirs may ultimately benefit because your estate will receive a tax receipt (and substantial tax savings) for the value of the donation.
If this option is favoured by you and your family, you will receive a charitable income tax receipt for the year in which you transfer ownership, based on the current surrender value of the policy plus any accumulated dividends and minus any outstanding loans. You will also receive a charitable receipt for any premiums that you keep paying.
You may not have to pay premiums indefinitely, because most whole life policies have a premium offset option. After seven to ten years, the dividends usually become sufficient to cover the cost of the annual premium and you no longer need to pay to keep the policy in force.
You can also donate a paid-up policy that you no longer need. You will receive a charitable income tax receipt for the surrender value and any accumulated dividends, minus any outstanding loans.
New policy
You can also purchase a new policy to benefit causes dear to your heart. Although the new policy has no current surrender value, should you make the General Synod of the Anglican Church of Canada the owner and beneficiary of the policy, your tax benefits can increase dramatically. If it is structured properly, you will receive a tax receipt for premiums you pay. In addition, the amount of your gift will continue to grow as the cash surrender value of the donated policy increases.
Joint policy
Perhaps you wish to name the General Synod of the Anglican Church of Canada as beneficiary of a joint policy covering you and your spouse. This provides you the benefit of one premium payment instead of two; in addition, if the policy is structured properly, a tax receipt for payments made will be given. Proceeds will be paid to the General Synod of the Anglican Church of Canada only after both parties have passed on.
Make the General Synod of the Anglican Church of Canada the owner
Make the General Synod of the Anglican Church of Canada the owner and beneficiary of a new or existing policy and the tax benefits can increase immediately and significantly. This option entitles you to a tax receipt annually for any premiums you subsequently pay.
Gifts of Life Insurance or Registered Plans made at the time of your death
You cannot claim any tax credits during your lifetime if you name the General Synod of the Anglican Church of Canada as the beneficiary of your life insurance in your will without transferring ownership of the policy. However, your estate will benefit from a tax credit if you name your estate as the beneficiary of the plan and make a bequest to the General Synod of the Anglican Church of Canada in your will. The gift is treated as a charitable donation in the year of your death and is eligible for a tax credit on your final tax return or in the previous year’s return.
Retirement Funds
Retirement funds you no longer need can have a tremendous impact when donated to the ministries of the Anglican Church of Canada. When you name the General Synod of the Anglican Church of Canada as beneficiary, your estate will receive a receipt to offset taxes due from the distribution of the RRSP or RRIF, which are among the most heavily taxed assets you own.
By naming the General Synod of the Anglican Church of Canada as the beneficiary to your registered plan, the plan does not form part of the estate assets that require probate. This may result in significant savings in some provinces where the fee is charged on the value of the estate. A beneficiary designation can be made directly on the RRSP or RRIF application form and can be changed only by the annuitant.
Disclaimer
There are numerous options for legacy gifts. We encourage you to consult with your legal and financial advisors to consider all the relevant issues and income tax provisions.
Let’s connect
Brochures are available on the various ways to give a planned gift. For any of these brochures, or for advice on how to give, please contact Resources for Mission at 416-924-9192 or [email protected].
Our legal name is “General Synod of the Anglican Church of Canada” and our charitable number is 10808 2835 RR0001.