Philanthropy & Tax Planning with Flow-Through Shares

In this episode, Ruben Antoine sits down with Albert Labelle, partner at PearTree Canada, to close out the three-part series on charitable giving with a deep dive into flow-through shares — one of the most powerful and least understood tools in Canadian tax and philanthropic planning.

Albert walks through what flow-through shares are, why the Canadian government created them, and how they work both as a tax reduction strategy and as a way to supercharge charitable giving. He explains how an individual in the highest tax bracket can make a $50,000 donation for as little as $1,000 out of pocket — and why this is not a loophole, but an intentional government program designed to support Canada’s natural resources sector.

The conversation also covers how corporations and holding companies can benefit from flow-through shares, the role of the Capital Dividend Account, and how PearTree has structured transactions to eliminate market risk for investors.

A fascinating and eye-opening episode for anyone who pays significant taxes, has philanthropic goals, or both.

Happy listening!

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Flow-Through Shares, Explained for Investors

• Introduction to Albert Labelle and PearTree Canada (01:49)
• What are flow-through shares and how did they originate? (03:14)
• Why mining companies can’t simply use banks or venture capital to finance exploration (07:02)
• Canada’s outsized role in global mining — 60 to 65% of mining companies worldwide are Canadian-based (07:02)
• How the government expanded flow-through shares to critical minerals with a 30% investment tax credit (09:50)
• Why oil and gas was excluded from the program in 2023 (09:50)
• Minerals and metals as the foundation of modern technology — from computers to electric vehicles (11:06)
• Flow-through shares in other countries — how Canada’s program compares (12:08)
• Flow-through shares representing over 80% of natural resources sector financing in Canada (14:14)
• The tax mechanics: reducing your effective rate from 53% down to the 37% alternative minimum tax floor (15:32)
• Who is the ideal candidate? Income profile, income type, and the $350,000 threshold (19:13)
• Why capital gains income is not well-suited for flow-through share transactions (20:32)
• How PearTree de-risked the transaction — knowing the buy price and exit price in advance (24:11)
• The philanthropic power of flow-through shares: making a $50,000 donation for as little as $1,000 (28:33)
• How flow-through shares combine with donor advised funds for maximum philanthropic impact (31:13)
• Is this aggressive tax planning or a loophole? Why the answer is neither (34:59)
• Using flow-through shares through a holding company or CCPC — benefits, differences, and the Capital Dividend Account (38:41)
• Key takeaways: amplifying generosity, reducing taxes, and letting professionals do the work (43:17)

Mentioned in this Episode:

Guest & host

• Albert Labelle (guest, Partner at PearTree Canada) — LinkedIn · PearTree bio
• Ruben Antoine, CFA, CPA (host, TMA advisor) — LinkedIn

Companies & organizations

• PearTree Canada — peartreecanada.com
• PDAC (Prospectors & Developers Association of Canada) — pdac.ca
• JCF (Jewish Community Foundation of Montreal) — jcfmontreal.org

Articles / studies cited

• The S&P Global Market Intelligence study on mine development timelines — “Discovery to production averages 15.7 years for 127 mines”

Related Podcasts

• Episode 1 of this 3 part series: How to Maximize Your Charitable Impact in Canada
• Episode 2 of this 3-part series, Your Money, Your Legacy: How Donor Advised Funds Work

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