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As a portfolio manager and advisor at Tulett, Matthews & Associates, Keith has spent twenty-five years helping investors achieve their financial goals using the same planning and portfolio principles discussed in The Empowered Investor podcast. Always an advocate for investors, Keith has spoken at global conferences, been quoted in many Canadian newspapers and magazines, and recently published the new and revised 4th edition of his book, The Empowered Investor.
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About This Episode
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!
Key Topics Covered:
- 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)
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Thanks for listening!
