Donating Shares, Property and Other Things That Are Not Cash

The points below about non-cash charitable gifts are ordered by how much difference they make, not by how often they get repeated.

Why an asset can beat the cash

In several tax systems, selling an appreciated asset triggers a charge that giving that same asset directly to a charity does not. Where that is the case, the charity receives the full value and the donor avoids a liability that would otherwise have reduced the eventual gift.

Whether this works, and by how much, depends entirely on local law, so it is a question for a qualified adviser rather than an article. The general shape of the rule appears in many countries, but the thresholds, eligible asset classes and relief mechanisms differ substantially between them. This is general information rather than tax advice, and anything involving a significant sum warrants professional guidance in your own jurisdiction.

The costs the charity inherits

A gift of land or buildings comes with insurance, maintenance, security, local taxes and often a legal obligation to keep it in reasonable condition. Those costs begin immediately and continue until the property is sold, which can take a long time for an unusual or remote building. A charity without property expertise may spend more on holding an asset than it eventually realises when it finally sells it.

The same logic applies to vehicles, boats, artwork and anything else needing storage, specialist insurance or a market that does not exist locally. Trustees who accept such gifts uncritically are making a decision with a running cost quietly attached to it.

Gift acceptance policies

Most organisations of any size maintain a written policy setting out which non-cash gifts they will accept and on what conditions. The policy usually reserves the right to sell an asset immediately, which is generally the sensible course and occasionally offends the donor. If you want an asset kept rather than sold, that is a restriction and should be discussed before the transfer rather than simply assumed.

Sorting the donation bags, some policies exclude assets with contamination risk, unclear title, ongoing liabilities or provenance the organisation cannot independently verify. Asking to see the policy before offering something unusual saves everyone an awkward conversation later on.

Shares and securities

Publicly traded shares are among the easiest non-cash gifts to handle, because valuation is unambiguous and disposal can happen immediately. Larger charities often have brokerage arrangements to receive and sell them within days, which keeps the administrative cost genuinely low. Unlisted shares in a private company are a different proposition entirely, since valuation is contestable and there may be no buyer at all.

Small parcels of shares can cost more in dealing fees than they are worth, and several countries have share-donation services set up to pool them. Check what the organisation can actually receive before instructing a transfer, since a failed transfer can be worse than no gift.

Gifts in kind for programme use

Donated stock, equipment or professional services can be genuinely valuable when they match something the organisation was going to buy anyway. When they do not match, the organisation absorbs storage, distribution and disposal costs for goods it never actually needed.

From the receiving end, the honest test is whether the charity would have spent its own money on the item at anything near the value being claimed for it. Valuation of in-kind gifts in published accounts follows accounting standards that vary by jurisdiction and is frequently misread by outsiders. Offering the equivalent cash and letting the organisation buy what it needs remains the default that works most often.

Tax treatment of donations varies by country and by the way the gift is made.

Doing it in the right order

Contact the organisation before transferring anything, since an unannounced asset arrival creates work and occasionally genuine legal difficulty. Confirm in writing whether the gift is unrestricted, so the organisation can sell it and spend the proceeds wherever they are most needed. Take your own tax advice before the transfer rather than afterwards, because most reliefs depend on the sequence in which things happened.

Expect the charity to sell the asset, and treat any attachment to its continued existence as a separate conversation to have first. Handled in that order, a non-cash gift is one of the most efficient ways available to give a large amount.

Everything above, in order of what to do first

1. Why an asset can beat the cash. In several tax systems, selling an appreciated asset triggers a charge that giving that same asset directly to a charity does not.
2. The costs the charity inherits. A gift of land or buildings comes with insurance, maintenance, security, local taxes and often a legal obligation to keep it in reasonable condition.
3. Gift acceptance policies. Most organisations of any size maintain a written policy setting out which non-cash gifts they will accept and on what conditions.
4. Shares and securities. Publicly traded shares are among the easiest non-cash gifts to handle, because valuation is unambiguous and disposal can happen immediately.
5. Gifts in kind for programme use. Donated stock, equipment or professional services can be genuinely valuable when they match something the organisation was going to buy anyway.
6. Doing it in the right order. Contact the organisation before transferring anything, since an unannounced asset arrival creates work and occasionally genuine legal difficulty.

The takeaway

Ring the charity before transferring anything that has a running cost attached to it.

Unrestricted money is the most useful gift and the least satisfying to make.