New gifting rules generally deny a donation credit for testamentary private company share gifts to public foundations or charitable organizations

A gift of non-qualifying securities to an arm’s length public foundation is generally excepted by s. 118.1(19) from the gift denial rule in s. 118.1(13). However, for testamentary gifts made after 2015, s. 118.1(5)(a) provides that a gift by will is deemed to be made by the estate, and s. 251(1)(b) continues to deem a personal trust to not deal at arm’s length with a person which is beneficially interested in it – such as a public foundation that is entitled to a testamentary gift. Accordingly, a testamentary gift of shares which are non-qualifying securities to a public foundation will not be an excepted gift.

Neal Armstrong. Summary of 19 June 2015 STEP Roundtable, Q.12 under s. 118.1(19).