The gift annuity is a simple contract between you, the donor and the T&DH Foundation.  With your donation, the T&DH Foundation purchases an annuity from a major Canadian life insurance company, which will make fixed payments to you or your spouse for life, or for a specified number of years.  After arranging the annuity, the T&DH Foundation uses the remainder of the donation for current or future needs.

A gift annuity brings a special bonus at tax time, because a sizeable portion of the payments will be tax-free for elderly donors.  Annuitants in their 70’s or older, typically will receive payments that are almost tax-free.  Donors will also receive a one-time donation receipt that will result in a tax credit.

Advantages:

• The most outstanding advantage is that as long as the annuity is set up properly, the income received by the donor triggers very little tax. This is because the Canadian Revenue Agency (CRA) deems all or part of the annuity income received by the donor as a return of capital. 
• The donor can receive an immediate donation receipt if the amount of capital given to the Foundation is less than the total amount of expected premiums.
• With an annuity, there is no need to pay for ongoing investment management services or administration fees.
• A charitable gift annuity allows the donor to give during their lifetime rather than postponing the gift until after death.

Drawback:

• The most notable drawback to charitable gift annuities is that once established they are irrevocable.