Tax Free Savings Account



All Canadian residents 18 years of age or older can open a TFSA. (Trusts are not eligible.) For an immigrant or permanent resident to Canada, the year when you arrive determines when your TFSA contribution limit begins.


Unlike an RRSP, the contribution you make to a TFSA will not be deducted from your income on your tax return – but the investment income you earn will not be taxed – so you get to keep what you earn. You can withdraw money from your TFSA at any time for any purpose without incurring tax.


If you don’t make the maximum annual contribution, you don’t lose the contribution room. The unused contribution room gets carried over to the following year. There is currently no limit to how much contribution room can be carried forward.


Money withdrawn from your TFSA will not affect your eligibility for federal income-tested benefits and credits such as the Child Tax Benefit, Guaranteed Income Supplement, Old Age Security benefits, the Age credit and Goods and Services Tax credit.


You will not be taxed on the investment earnings in the TFSA. You will not be taxed on funds withdrawn from your TFSA.


You can contribute the maximum of $5,000 per year beginning January 1, 2009. The annual contribution room is indexed to inflation and adjusted annually to the nearest $500. For 2024, it is $7,000. As of 2024, the total amount of contributions is $95,000.


You will have to file a tax return to determine your contribution limit. Each year the CRA will determine and advise you of your TFSA contribution limit for that year on your notice of assessment.


Contributions to a spouse’s TFSA are allowed. TFSA assets can be transferred to a spouse upon death which would continue the tax exempt status of the earnings and not affect the surviving spouse’s contribution room.


Eligible investments include Mutual Funds, Segregated Funds, Stocks, Bonds and GICs.


If you take money out of your TFSA, you don’t lose the contribution room – you get it back the following year but you will have to wait until the following year before you can put the money back in.


You can hold one or more TFSAs but the total of your annual contributions must be within your total contribution limit for that year.

TFSA Calculator


Click on the link to launch a simple Excel worksheet to calculate your TFSA total contribution room.


TFSA Calculator 2024