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Tax-Free Savings Account

TFSA allows taxpayers to set money aside in eligible investment vehicles and watch those savings grow tax-free throughout their lifetime. There are no restrictions on the way the funds may by used.

 

  • The TFSA is available to Canadians 18 years of age and older
  • Investment income earned in the account is not taxed
  • Each year, beginning in 2009 you will have a maximum contribution limit of $5000. For 2013 the new contribution room has been adjusted to $5,500. This contribution limit may be adjusted dependant on the rate of inflation each year
  • Unused contribution room can be carried forward indefinitely
  • You can withdraw funds from the TFSA at any time for any purpose although transfers or withdrawals may be restricted based on selected investment terms.
  • While contributions are not tax-deductible, tax-free withdrawals can be made anytime.
  • Any withdrawals from the plan add to future contribution room, letting you 'replace' whatever you take out.
  • Neither income earned in a TFSA nor withdrawals will affect your eligibility for federal income-tested benefits and credits, such as the Guaranteed Income Supplement and the Canada Child Tax Benefit.
  • Contributions to a spouse’s TFSA are allowed and TFSA assets can be transferred to a spouse upon death.


For additional information on TAX FREE SAVING ACCOUNTS see the following link:
www.rpsuccess.ca/presentations/TFSA%20Contribution%20Room/player.html

 Caution

Your designation of beneficiary by means of designation form will not be revoked or changed
automatically by any future marriage or divorce. Should you wish to change your beneficiary in the event of a future marriage or divorce, you will have to do so by means of a new designation.

 


 

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