TFSA Information

The Tax-Free Savings Account or TFSA for short were introduced by the Conservative Government in the 2008 budget speech and became law January 01, 09. It is an investment vehicle that is becoming very popular by Canadians.

This page will bring you the following Topic Section in the order presented.

Why are TFSAs so popular with Canadians?

TFSA Eligibility And Contribution limits

Types of investments you can have inside a TFSA

TFSA vs RRSP

TFSA and Retirees

For More TFSA Information

TFSA – New Canadian Tax-Free Savings Accounts Video

TFSA Information in the News

Please Leave Your TFSA Comments

Why? Because we don’t have to pay any taxes on earnings or withdrawals from investments held within a TFSA plan.

This allows Canadians to free up more money they normally wouldn’t have because of these powerful features. Can you imagine how beneficial that can be to your savings account balance over time?

Popular and very Powerful indeed!

Individuals 18 years and older can contribute $5,000 per year into a TFSA whiles couples married or common-law can contribute $10,000 per year. That’s $5,000 each into both accounts.

You are not required to have any income to open an account. Which means one spouse can contribute to the other persons TFSA if needed. And the withdrawals will be made tax free by the person who owns the account. (This is also a great way to utilize income splitting).

Any unused contribution room gets carried forward to future years.

The TFSA can shelter virtually any type of investment including:

· Cash

· Bonds

· GICs

· Stocks

· Mutual funds

And remember (I like saying this) any income earned weather by interest accumulated, dividends or capital gains are all sheltered from taxes inside a TFSA.

The first question many people ask about TFSAs is whether they should use TFSAs or RRSPs for retirement savings.

There’s no easy answer. TFSAs provide a valuable new option for retirement planning, but how they are best used will depend on each person’s circumstances.

To begin with, it’s important to understand that TFSAs and RRSPs are two different creatures from a tax and savings perspective.

Unlike a RRSP, contributions made to the TFSA are not eligible for tax deductions.

Even though you’re earning are sheltered from the tax man inside a RRSP you do have to pay taxes on any withdrawals not like the TFSA.

Also another nice feature unlike an RRSP any accumulation room freed up by withdrawals from a TFSA can be replaced anytime in future years.

Each investor will be notified of the amount of room within their TFSA’s each year during their T1 assessment.

You should read the book Tax-Free Savings Accounts by Gordon Pape for a more indebt and detailed strategies that you can use to but thousands of tax-exempt dollars to your personal wealth.

You’re not going to find this powerful information anywhere else. I highly recommend his book because he has written the definitive manual on how to use the TFSA.

You can get is book at Amazon.ca or by visiting tfsa-info.com