Tax Free Savings Accounts (TFSAs)

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 does a Tax-Free Savings Account Work?

  • Canadian residents age 18 or older who is an eligible taxpayer and has a SIN number is eligible.
  • Current annual deposit limit $6,000
  • 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
  • 2018: $5,500
  • 2019: $6,000
  • 2020: $6,000
  • 2021: $6,000
  • 2022: $6,000
  • Total: $81,500

* Mutual funds are offered through Credential Asset Management Inc.

Financial Services Regulatory Authority of Ontario (FSRAO)

FSRAO's role is to protect depositors of Ontario credit unions. All insurable non-registered deposits are covered up to $250,000. Insurable deposits in registered accounts have unlimited deposit coverage. This is free automatic coverage for you our members!

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