Combining a life annuity with a life insurance policy can be a tax effective way to increase your cash flow and arrange a substantial future gift supporting health care at the QEII. Sound too good to be true? The insured annuity is a legitimate planning strategy.

Here’s how it works:
You purchase an annuity with a lump sum from your non-registered funds that provides you a guaranteed life income. Like most annuities, a significant portion of the annuity payments are considered a return of your own capital, and that portion is not taxed.

At the same time you purchase a life insurance policy, the ownership of which is transferred to the QEII Foundation. Because the Foundation owns the policy the annual premium payments qualify for a charitable income tax receipt. On your death the insurance policy proceeds are paid to the Foundation.

The annuity payments will more than offset the cost of the insurance premiums. You can use the remaining portion of the annuity payments for your annual expenses, to provide charitable gifts (that will earn further income tax credits), or perhaps purchase a second life insurance policy to benefit your heirs or pay to your estate to offset income tax due on your final tax return.

Charles O'Neil, director of gift planning at the QEII Foundation, is available at (902) 473-7932 or at qe2-hsc.ns.ca to explore all options available. All discussions are held in strict confidence and do not require any commitment on the part of the donor. 

The information on this website is provided for the general information of donors and friends of the QEII Health Sciences Centre Foundation. It is not intended to be a substitute for professional legal or financial advice. As individual situations may differ you are strongly advised to consult with your own professional legal, estate planning and financial advisors before deciding upon a course of action.