Tax-Free Savings Account

A Tax-Free Savings Account is an account that provides tax benefits for saving in Canada. Investment income, including capital gains and dividends, earned in a TFSA is not taxed in most cases, even when withdrawn.

Individuals who are 18 and older can set aside money tax-free throughout their lifetime. Contributions to a TFSA are not deductible for income tax purposes.

Any amount contributed as well as any income earned in the account (for example, investment income and capital gains) is generally tax-free, even when it is withdrawn. 

Administrative or other fees in relation to TFSA and any interest or money borrowed to contribute to a TFSA are not deductible.

Contributions, withdrawals and transfers:

• You can contribute up to your TFSA contribution room. A tax applies to all contributions exceeding your TFSA contribution room.
• Withdrawals will be added to your TFSA contribution room at the beginning of the following year.
• You can replace the amount of the withdrawal in the same year only if you have available TFSA contribution room.
• Direct transfers must be completed by your financial institution.

You Need Advice & We Can Help

Professional advice is very important before purchasing a TFSA. Let us help you with this important investment decision.