As you evaluate your circumstances, consider your finances as well as other personal resources. As you review your financial situation, take account of the following questions. If you are not sure about the answers to any of them, you should contact your financial adviser. In any case, it is a good idea to talk to your financial adviser or lawyer if you are thinking about making a significant or long-term donation. It is also essential if you are contemplating such a donation as part of an overall approach to managing your financial affairs.
- How much money do you think you might be able to give? Over what period of time?
- Is this likely to be one lump sum (for example, from the sale of a company, a block of shares, or an inheritance)?
- Could you set aside a regular amount from your salary, fees or pension?
- Do you sometimes benefit from regular extra income, such as an annual bonus?
- How much do you think you will want to give in the future?
- Do you think you might want to leave some money to charities in your will?
- Would you like to make sure that your donations continue after your death?
- Are there time-sensitive tax considerations (such as giving shares to a charity to obtain tax relief on the gift in the current tax year) that influence your decision?
Based on what you want to support and your financial situation – and how you can give tax efficiently – determine what giving mechanisms are most appropriate. For example, you might consider the following options:
- Setting up a private or family charitable trust
- Giving through an intermediary, such as a venture philanthropy fund or a community development finance institution (CDFI)
- Outsourcing the administration by establishing a named fund at a community foundation or setting up a charity account
- Setting up a mechanism through which you can make cross-border gifts
For tax and legal advice that addresses your own needs and circumstances, please contact your professional adviser.
