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Tax Free Savings Account

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What are TFSAs?

  • A federal government tax-shelterd saving program, designed to encourage
    Candians to save and invest for short, medium or long-term goals.

Contributions

  • Annual Limit for 2020 is $6,000 each year (begining at age 18)
    + Previous Contribution Room
    + Previous year withdrawals

  • You can deposit a maximum total contribution of $69,500

  • Contribution Period: January 1 to December 31 each year.

  • Contributions above the overall contribution limit is subject to a 1% / month penalty
    (refer to CRA website)

  • A client's contribution room can be found in their Notice of Assessment, CRA My

  • Account(online), Notice of Reassessment, and T1028

  • In-kind contributions: captial gains must be declared, capital losses cannot be

  • claimed. Current market value is used to calculate contribution amount.

Benefits at a Glance

  • Investments inside a TFSA are tax sheltered

  • Contributions are after-tax (no deduction)

  • Withdrawals are tax-free(no withholding)