Despite the financial havoc wreaked on the business community, major charitable donations kept making their way to local organizations. Some of Canada’s biggest philanthropists viewed COVID-19 as an incentive to give more, says Peter Nicholson, founder and president of Wealth Creation Preservation & Donation Inc. (WCPD).
Though donors were hesitant to give amid stock market fluctuations through spring 2020, things rapidly rebounded. WCPD even managed to secure a $33.3 million donation from a British Columbia donor in April - the largest in the company’s history.
In the latest episode of Behind the Headlines podcast, OBJ publisher Michael Curran spoke with Nicholson about how flow-through shares encouraged major gifts from donors, even during a pandemic. This is an edited transcript of that conversation.
Peter, I think you have the finger on the pulse when it comes to the charitable sector, particularly when it comes to major gifts. Give us an update about what’s happened to these major gifts to charities during the pandemic.
I remember March 2020 very, very well. We had our biggest offer of all time. We were contacting our regular donors that donate every year … and we weren't getting anywhere. Of course, people were asking us, ‘Don't you read the news? I don't know if I'll even have money for myself, let alone share it with charities.’ There was a lot of fear for about three weeks. And we actually sold it all out on the Easter weekend, which was a total shock. But the reason why is because it resonated with the donors across Canada. Our charities need us more than ever. We had a good year in 2020, we had another good year in 2021, all because of people stepping up with COVID — the big donors. When times are tough, the big philanthropists in Canada do step up.
I want to spend just a brief moment talking about what's called flow-through shares. Can you give us more information?
The flow-through share has been in the tax code since 1954 to promote mining exploration. The government gives you a 100 per cent deduction. So I thought, well, I've been doing these as a safe area with Revenue Canada. The idea is to help with mineral exploration and drilling, which creates jobs. I said, if we then take those shares that are public, and then give them to charities of our client’s choice, we could get a second deduction because we're helping a second tax policy. By combining these two tax policies, you can actually get a phenomenally tax efficient donation. And that's what our clients do … usually they're giving three times more than they usually would, just because of creating that tax efficiency. You can change a $100,000 gift into $300,000.
I want to talk about an event that's coming up on Nov. 10 at the National Arts Centre. It’s called the Phils … the Ottawa Philanthropy Awards. WCPD is the title sponsor. Are you excited to see people back in person at a gala?
I really am. We'll have 150 people in person and then other people on Zoom. Nothing beats the face-to-face camaraderie of being there. I call them the Academy Awards for the big donors in Ottawa. They should be celebrated. It's a big aspect of what makes Ottawa great. It's a great, great time and a great celebration. And it's very fiscally strong. We've got great sponsorship now. And it's stronger than it really has been in many, many years.