Tax-Free Savings Accounts

What is a Tax-Free Savings Account (TFSA)?

TFSAs were created to help Canadians save and grow their money outside their RRSPs while earning tax-free investment income.

How Does a TFSA work?

  • Any Canadian resident 18 years or older can hold a TFSA.
  • Each year you can contribute up to a specified amount into your TFSA.
  • Your money grows tax-free – when you withdraw funds you pay no tax, and you pay no tax on interest earned.
  • If you didn’t maximize contributions in any given year, the unused contribution room accumulates and can be used in future years.
  • You can withdraw funds without penalty and re-contribute to catch up in later years (recontributing in the same year may result in an over-contribution amount which would be subject to a penalty tax).
  • Income earned in, or funds withdrawn from, a TFSA do not affect eligibility for certain benefits and credits such as Old Age Security or the Canada Child Benefit.
  • TFSAs are flexible – you can invest in term deposits, GICs, mutual funds* or just leave it in a savings account. And, you can save for anything – a new car, a vacation, a home renovation or just a rainy day.

Contribution Amounts

Year
Contribution Limit
2017 $5,500
2016 $5,500
2015 $10,000
2013/2014 $5,500
2009-2013 $5,000


Libro offers many investment options to help your TFSA contributions grow tax-free. Even better, we help you create strategies to find balance between RRSP contributions, RESP contributions, TFSA contributions and contributing to your need for new shoes, a new truck or the odd night out for dinner from time to time.

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*Credential disclosure and mutual funds disclaimer