WHAT IS A TFSA?
Tax-free savings account( or , as I call it, the smart investment account)
With a tax-free savings account (TFSA) the options are endless. In 2009, the Canadian Government introduced the opportunity to save more and faster regardless of what your needs may be. Whether saving for a house, car, further education, a vacation or additional retirement savings, one account allows your individual goals to be met.
- A TFSA will allow savings without paying tax on any income or capital gains earned.
- Starting January 1, 2013, you can contribute up to $5,500 per year (for all combined TFSA accounts, at any institution)
- Up to $5,000 of unused contributions per year can be carried over from 2009-2012
- Withdrawals can be made at any time, for any need, but may not be replaced until the following calendar year.
- TFSAs are transferable to your spouse/common-law partner upon death.
- TFSAs will not affect eligibility for federal income tested benefits.