TFSAs

What is a TFSA?

A Tax-Free Savings Account (TFSA) is a registered savings account that allows Canadian taxpayers 18 years or older to earn investment income tax-free. 

Introduced in 2009, the federal government is using TFSAs to encourage Canadian residents to put money aside in eligible investments that will grow their savings tax-free throughout their lifetime. Plan holders can decide how they want to use their accumulated savings be that for a vacation, a down payment, a wedding, a "rainy day" or whatever. But, there are rules.

 

What are the benefits of a TFSA?

 

Tax Free Withdrawals

Money withdrawn from the TFSA is not taxed or added to taxable income. There is no restriction on when you can withdrawal your money, unless it is locked in to a GIC investment (See your investment criteria for details).

Contribution Room Carried Forward

Unused contribution room is carried forward indefinitely. Withdrawals made in a year are added to the contribution room for the following year.   Contribution room for 2009-2012 was $5000, 2013-2014 was $5500, 2015 was $10,000, and 2016 is $5500.

Eligibility

Allows eligible Canadians to accumulate savings tax free. Minimum age restriction is 18 years old but there is no maximum age restriction.

Transferrable

TFSAs are transferable to a spouse/common-law partner upon death or relationship breakdown. It will not impact the contribution room for the spouse/Common law partner.

 

Contributing to a TFSA

  • Contributions to a TFSA may only be made by the Holder and the amount is not tied to income of the holder.
  • $5000 was the maximum TFSA contribution limit from 2009 to 2012. In 2013 to 2014 the maximum contribution limits increased to $5500. In 2015 it increased to $10,000, which then declined back to $5500 in 2016.  2017 TFSA limit is $5500.  Unused contribution room accumulates each year (starting in 2009 or in the year in which the individual turns 18 years of age).
  • Contributions are not tax deductible

 

TFSA Options

 

Savings Account

A TFSA HISA is similar to a regular savings account, except with a TFSA you will gain interest no matter the amount of funds in the account.

Guaranteed Investment Certificate (GIC's)

If you are interested in investing your TFSA into a term with guaranteed return on your investment over a period of time then a GIC is the product for you.

Mutual Funds*

Contact your Credential Asset Management Inc. Mutual Funds Investment Specialist at Quinte First Credit Union today for more information.

 

Ready to get started?


To learn more about TFSA's or to discuss your options, meet with one of our
knowledgeable and friendly wealth management professionals.

Call us at 613-966-4111 or visit your local branch 

*Mutual funds are offered through Credential Asset Management Inc. Unless otherwise stated, mutual fund securities and cash balances are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions.

 

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