Tax-Free Savings Account (TFSA)

The TFSA is a type of registered savings account that allows taxpayers ages 18 and over to earn interest, other types of investment income and capital gains tax-free.

Who is a TFSA best suited for?

A TFSA is best suited for any Canadian resident who is over 18 with a Social Insurance Number and who would like to save including:

• Individuals who want to access to funds on a tax-free basis before retirement.
• Individuals who have maximized their RRSP contributions.
• Seniors who have savings and are concerned about their investment earnings impacting federal income-tested benefits or credits (i.e. such as Old Age Security benefits, the Guaranteed Income Supplement, or the federal age credit.)

What kind of investments can I hold in a TFSA?

A TFSA is generally permitted to hold all the same investments that a registered retirement savings plan (RRSP) can hold. This includes cash, mutual funds, publicly traded securities, GICs, bonds, and certain shares of small business corporations.