Payment is being processed. Please do not refresh or close this page until your payment is complete.

Get My Policy Book an Appointment
19 Aug

How residents of Canada can invest tax-free

A Tax-Free Savings Account (TFSA) is a beneficial investment option in Canada, allowing residents to grow their wealth tax-free. 

Contributions are made with after-tax dollars, and any investment income or withdrawals are not taxed. In 2024, the annual contribution limit is $7,000, with the maximum cumulative contribution room since 2009 being $95,000.

TFSAs can hold various investments, including ETFs, mutual funds, and stocks, making them ideal for long-term growth. Residents of Canada aged 18 or older with a valid Social Insurance Number (SIN) can open a TFSA, regardless of their legal status. 

It's essential to track contributions to avoid penalties, as excess contributions are taxed at 1% per month.

If a TFSA holder becomes a non-resident, they can keep their TFSA without accruing new contribution room, but should avoid contributing to avoid penalties. 

Upon the holder's death, a spouse or common-law partner can inherit the TFSA tax-free as a successor holder. 

Source: https://www.cicnews.com/2024/08/how-residents-of-canada-can-invest-tax-free-0845801.html#gs.dtfe7s