Tax Free Saving Accounts

A Tax-Free Savings Account is a great way to save money for a short term goal or to augment your retirement savings plans. The Tax-Free Savings Account (TFSA) is a flexible savings account registered with the Government of Canada that allows you to earn tax-free investment income. You don't need to have earned income to contribute to a TFSA. There is no requirement to collapse your TFSA at a set age.

  • The TFSA annual contribution limit is determined each year by the Federal Government and announced in the annual Federal budget
  • All Canadian residents, aged 18 or older, can contribute to a TFSA
  • Investment income earned on qualified amounts in a TFSA is tax-free
  • Withdrawals from a TFSA are tax-free
  • Unused TFSA contribution room is carried forward and accumulates in future years
  • Full amount of withdrawals can be put back into the TFSA in future years. Re-contributing in the same year may result in an over-contribution amount which would be subject to a penalty tax
  • Choose from investment options such as Term Deposits and High Interest Savings Accounts
  • Contributions are not tax-deductible
  • Neither income earned within a TFSA nor withdrawals from it affect eligibility for federal income-tested benefits and credits, such as Old Age Security and GST
  • Funds can be given to a spouse or common-law partner for them to invest in their TFSA
  • TFSA assets can generally be transferred to a spouse or common-law partner upon death