Tax-Free Savings Account (TFSA)
Save and invest with tax-free growth and withdrawals, subject to annual contribution room.
A TFSA is a flexible registered account: contributions are made with after-tax dollars, investment income and capital gains can grow tax-free, and withdrawals can increase future contribution room the following calendar year according to CRA rules.
Do not treat social media limits as authoritative—always check your personal room on CRA and the annual TFSA dollar limit published for each year.
- Open a TFSA at an issuer (financial institution)Often required
Must be a TFSA arrangement; track your own contributions against room.
- CRA My Account or notice of assessment
Check your available TFSA contribution room.
- Annual contribution room is set by Parliament and accumulates if unused.
- Excess contributions may be subject to a monthly penalty tax until withdrawn.
- Qualified investments follow CRA rules; non-qualified and prohibited investments can have tax consequences.
- Contributions are not deductible; growth and qualified withdrawals are generally tax-free.
- Must be 18 or older with a valid SIN to contribute (provincial age of majority applies for opening in some cases).
- Non-residents may have different contribution room rules—verify on CRA.
Disclaimer
This guide is for general information only. Tax and benefit rules change. Always confirm current requirements with the Canada Revenue Agency, Service Canada, or a qualified financial or tax professional before making decisions.