Tax Free Savings Account (TFSA)

Save Money Tax-Free for Short-Term or Long-Term Goals

The Tax-Free Savings Account (TFSA) is a powerful and flexible savings tool introduced in 2009 to help Canadians grow their money without paying tax on contributions or investment earnings. Anyone who is 18 or older with a valid Social Insurance Number (SIN) can open and contribute to a TFSA.

While TFSA contributions are not tax-deductible, any money earned inside the account—whether interest, dividends, or capital gains—is completely tax-free, both while invested and when withdrawn.

TFSA Contribution Room

TFSA contribution room is the maximum amount you can add to your Tax-Free Savings Account each year. Your contribution room begins accumulating the year you turn 18 and become a resident of Canada. Even if you don’t open a TFSA or file a tax return, your TFSA room continues to grow annually.
Annual TFSA Contribution Limits:

2013-2014: $5,500
2015: $10,000
2016-2018: $5,500
2019-2022: $6,000
2023: $6,500
2024-2025: $7,000

Example: Total Contribution Room Someone who has never contributed to a TFSA and was born in 1991 or earlier would have a total accumulated TFSA contribution room of $102,000 as of January 1, 2025.

Impact on Your Government Benefits and Credits

One of the biggest advantages of a TFSA is that any income earned inside the account—or money withdrawn from it—does not affect your eligibility for government benefits and credits. This includes federal income-tested programs such as Old Age Security (OAS), the Guaranteed Income Supplement (GIS), and Employment Insurance (EI).

In the same way, TFSA earnings and withdrawals do not impact your eligibility for federal credits like the Canada Child Benefit (CCB), the Working Income Tax Benefit (WITB), the GST/HST credit, or the Age Amount.

You can withdraw funds from your TFSA at any time without tax consequences, and your eligibility for these benefits and credits will remain unchanged.