Tax Free Savings Accounts (TFSA's)

Save your money and the taxes! A Tax Free Savings Account (TFSA) is a registered general-purpose savings product that allows you to earn tax-free interest income in the account to more easily meet your short-term or lifetime savings needs whether it be to purchase a new car, renovate a house, start a small business or take a family vacation.

A TFSA can make an excellent complement to an RRSP and may be used to maximize retirement income when RRSP contribution limits have been reached.

How the Tax-Free Savings Account Works

  • Canadian residents age 18 or older who is an eligible taxpayer and has a SIN number is eligible.
  • Current annual deposit limit $5,500 (in total an individual can have contributed up to $52,000 including the year 2017).
  • Investment income earned and withdrawals made from a TFSA account are not subject to tax.
  • 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 a wide range of TFSA investment options such as Mutual Funds, Guaranteed Investment Certificates (GICs) and Bonds.
  • Contributions are not tax-deductible like an RRSP product.
  • Neither income earned within a TFSA nor withdrawals from it affect eligibility for federal income-tested benefits and credits, such as Old Age Security, the Guaranteed Income Supplement, and the Canada Child Tax Benefit.
  • 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.

How much can I contribute?

Starting in 2009, TFSA contribution room accumulates each year in which you are at least 18 years of age (at any time in the year), have a Canadian social insurance number and are a resident of Canada.

Contribution room for each year is as follows:

2009 $5,000
2010 $5,000
2011 $5,000
2012 $5,000
2013 $5,500
2014 $5,500
2015 $10,000
2016 $5,500
2017 $5,500

Example: John was born before 1992 and has been resident in Canada from 2009 to 2016. He has never had a TFSA before. In 2016, he can open a TFSA and contribute a total of $46,500.

Would you like more information on TFSA's?

Contact your nearest branch



Mutual funds and securities related financial planning services are offered through Qtrade Asset Management Inc., Member MFDA.

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