# Flow-Through Mining Shares

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### **Structured Mining Flow-Through Donations in Canada**

*A Tax-Efficient Giving Strategy for High-Income Donors*

#### **Overview**

Structured mining flow-through share donations are a sophisticated charitable giving strategy that allows Canadian donors—especially those with high taxable income—to **significantly reduce their tax bill** while supporting charitable causes. This strategy leverages Canada’s **flow-through share regime**, originally designed to promote investment in resource exploration, alongside the **federal charitable donation tax credit system**.

#### **How It Works**

1. **Flow-Through Share Purchase**\
   A donor purchases **flow-through shares** (FTSs) from a Canadian mining or energy exploration company. These shares allow the investor to "flow through" exploration expenses to their personal tax return, generating a **100% tax deduction** of the purchase amount.
2. **Donation to Charity**\
   The donor gifts those shares to a GiveWise Giving Fund through a structured donation facilitator.
3. **Charity Liquidates Shares**\
   GiveWise **immediately sells** the shares to a pre-arranged liquidity provider (known as a "back-end buyer") to convert them into cash without taking on market risk.
4. **Donor Receives Tax Receipt**\
   The donor receives a **charitable donation tax receipt from GiveWise immediately,** equal to the **fair market value (FMV)** of the shares at the time of donation, typically close to the original purchase price.
5. **Capital Gain Exemption**\
   Normally, donating publicly traded securities triggers a capital gain. However, under Canadian tax law, there is **no capital gains tax** when publicly listed shares are donated to a charity—resulting in additional tax savings.

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#### **Example of Tax Benefits**

For a donor in a 50% marginal tax bracket:

* **$100,000** FTS purchase → **$100,000** tax deduction
* FMV of donated shares: $100,000 → **$50,000** charitable tax credit
* **Effective after-tax cost**: often **\~$3,000–$5,000**
* **Resulting GiveWise Giving Fund balance to gift out to charities: $100,000**

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#### **Major Facilitators Who GiveWise Works With**

These firms structure and facilitate flow-through share donation programs, including donor onboarding, tax documentation, and coordination with GiveWise and issuers:

* **PearTree Canada**\
  One of the largest facilitators, working with charities and donors nationwide.
* **Oberon Capital Corp.**\
  Offers structured charitable donation solutions via flow-through shares.
* **WCPD Foundation / Wealth Creation Preservation & Donation Inc.**\
  Pioneer in structured charitable flow-through giving.

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#### **Ideal for:**

* High-net-worth individuals with large tax liabilities
* Corporations with exploration-focused investments
* Donors seeking to multiply the impact of their giving

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Contact <dan.kyte@givewise.ca> for more information and to be introduced to a flow-through facilitator.