Property Donations 

It has become increasingly common in North America for landowners to want to donate their properties, especially those in good natural state and value, to conservation organizations, including parks. Between April 1995 and March 2003, a total of 325 gifts of over 24,000 hectares of land, valued at more than $67 million, were certified through the Ecological Gifts Program administered by Environment Canada.

Donations of ecologically sensitive land certified as “ecological gifts” (or “ecogifts”) have been rapidly gaining acceptance and popularity since the 2000 Federal Budget introduced enhanced tax treatment and related amendments to the Income Tax Act (the Act).

The two principal benefits of the program are relief from the annual donation limits and a reduction from one half to one quarter for the rate at which deemed capital gains are included in income. At the same time, individual and corporate donors are entitled to a charitable donation receipt for the fair market value of the gift. This program is intended to provide encouragement and incentives for Canadians to take voluntary action to protect the environment, including species at risk, and to make responsible stewardship of the land an easy choice.

To qualify, the land must be certified as ecologically sensitive. The definition of ecologically sensitive is broad and inclusive of lands with both existing and potential ecological value. The following national criteria apply to both environmental values and those that may result from conservation initiatives:
• areas identified, designated or protected by local, provincial, territorial, national or international system or body as ecologically significant or ecologically important;
• natural spaces of significance to the environment in which they are located;
• sites that have significant current ecological value, or potential for enhanced ecological value, as a result of their proximity to other significant properties;
• municipal or rural lands that are zoned or designated for biodiversity objectives;
• natural buffers around environmentally sensitive areas such as water bodies, streams or wetlands; and
• areas or sites that contribute to the maintenance of biodiversity or Canada’s environmental heritage.

Several provinces, including Ontario, Quebec, New Brunswick and Prince Edward Island, have refined and adapted these general criteria to their specific circumstances. The criteria for gifts in Ontario can be viewed at the Ontario ecogifts Web site: Environment Canada's Ecological Gifts web page.

To qualify for a charitable donation receipt, ecological gifts must satisfy the basic legal requirements of gift giving, including the requirements that a gift be made voluntarily and without consideration or benefit to the donor. The eligible amount of a gift will be defined as the difference between the fair market value of the property and the value of the actual advantage or consideration paid to the donor.

There are two principal tax advantages to gifts made under the Ecological Gifts Program. First, the calculation of the non-refundable credit to individuals or the deduction amount for corporations is not limited to 75 percent of income as it is for a gift that could not be certified as an ecological gift.

Secondly, the Act provides for the elimination of the deemed capital gains arising from the disposition and transfer of the property where the gift qualifies as an ecological gift. This is in contrast to the standard one half inclusion rate. The elimination of the deemed capital gain in income, at the same time that the donor is entitled to a charitable donation receipt for the fair market value of the property, often results in significant potential tax savings to the donor.

In order to help Canada's landowners and conservation groups preserve Canada's natural heritage, the Government of Canada has eliminated the tax on capital gains for all certified ecological gift donations made on or after May 2, 2006 by reducing the inclusion rate to zero.
This program is managed through Environment Canada’s Ecogift Program, with detail at Environment Canada's Ecological Gifts web page.

Contacts for both conservation easement and gifts of ecological lands in this region include:

Thousand Islands Watershed Land Trust
19 Reynolds Road
Lansdowne ON
K0E 1L0
info@tiwlt.ca
613 659-4824

Rideau Waterway Land Trust
1 Jasper Ave,
Smith Falls ON
K7A 4B5
sharonw@rwlt.org

Land Conservancy for Kingston,
Frontenac, Lennox & Addington
P.O. Box 825, Main Post Office
Kingston, ON K7L 4X6
http://www.landconservancykfla.org

Nature Conservancy of Canada
110 Eglinton Avenue West, Suite 400 Toronto ON
M4R 1A3;
Tel: (416) 932-32022;Toll-free: 1-800-465-0029 Fax: (416) 932-3208
nature@natureconservancy.ca

Ontario Heritage Trust
10 Adelaide Street East Toronto ON
M5C 1J3;
Telephone: 416-325-5000 Fax: 416-325-5071
http://www.heritagefdn.on.ca

Ontario Nature
366 Adelaide Street West, Suite 201
Toronto, Ontario M5V 1R9
Tel: 416-444-8419
Toll free (within Ontario): 1-800-440-2366
http://www.ontarionature.org