Tax-Free Savings Accounts
With a Tax-Free Savings Account (TFSA), your investments grow tax-free and you can make tax-free withdrawals at any time, for any reason.
Who can open a TFSA?
Any Canadian resident 18 years or older with a Social Insurance Number.
The age of majority is 19 for residents of Newfoundland and Labrador, New Brunswick, Nova Scotia and British Columbia which may delay the opening of a TFSA. However, the accumulation of contribution room will start at age 18.
What are the benefits?
- Tax-free investment income, including interest, dividends and capital gains
- Any unused contribution room can be used in future years
- No upper age restriction on contributions, unlike an Registered Retirement Savings Plan (RRSP)
- Make withdrawals any time for any purpose (e.g. car purchases, vacations, home renovations)
- Previous year's withdrawals are added back to your unused contribution room
- Income earned and withdrawals have no impact on federal income-tested benefits or credits (Guaranteed Income Supplement, Child Tax Benefit, Old Age Security, etc.)
- Canadians can contribute to their spouse's or common-law partner's TFSA subject to available contribution room
What are the considerations?
- Unlike an RRSP, contributions are not tax deductible
- Capital losses within the TFSA cannot be used to offset taxable capital gains outside the TFSA
- Interest on funds borrowed to fund the TFSA is not tax deductible
- Penalty tax on excess contributions
What investments are qualified for the TFSA?
- Cash, guaranteed investment certificates (GICs), publicly traded securities, and government and corporate bonds.
For more information, please contact us or visit the Canada Revenue Agency website.
TFSA Contribution Room
Starting in 2009 or in the calendar year you are 18 years of age, your TFSA contribution room accumulates every year.
| | TFSA Contribution Room | |
| Years | Annual Limit | Cumulative Total |
| 2009 - 2012 | $5,000 | $20,000 |
| 2013 - 2014 | $5,500 | $31,000 |
| 2015 | $10,000 | $41,000 |
| 2016 - 2018 | $5,500 | $57,500 |
| 2019 - 2022 | $6,000 | $81,500 |
| 2023 | $6,500 | $88,000 |
| 2024 | $7,000 | $95,000 |
As of January 1st, 2024, the total cumulative contribution amount since 2009 is $95,000.
