It is a must that investors become aware of a highly anticipated new savings vehicle that allows Canadians to earn investment income tax-free inside their account. Canadian residents ages 18 years or older will now be able to enjoy the benefits of the new registered Tax-Free Savings Account (TFSA).

With RRSP savings still atop the list in terms of investment importance due to its overall tax deferral, the Tax-Free Savings Account is a valuable tool to have in a portfolio that allows tax-free accessible growth.  Contact your All Group investment advisor to learn how to take full advantage of this opportunity.


About The TFSA
Eligible Investments



The Tax-Free Savings Account allows you to invest while not being taxed on interest earned or investment earnings. Individuals are abled to contribute a maximum of $5000 per year to the account, and contribution limits will rise with inflation in $500 increments. You may also choose to double the tax-free income available by contributing to your spouse’s, or common-law partner’s TFSA, depending on the available room. Unused contribution room gets carried over to the following year and there is not limit as to how much contribution room can be carried forward.

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Unlike a Registered Retirement Savings Plan, contributions to a TFSA are not tax-deductible, but interest and investment income (including capital gains) earned in the account are not taxed, even when withdrawn. Funds can be withdrawn at any time and there are no restrictions as to how the money is spent. Withdrawals can be put back into your TFSA without reducing contribution limits, but you may only do so in the following year.

Furthermore, neither income earned in the TFSA nor withdrawals from it will affect federal income-tested benefit and credits such as GIS, Canada Child Tax Benefit, the GST credit, to name a few.

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In general, qualified investments for the TFSA includes all arm’s length RRSP-qualified investments, such as cash, government and corporate bonds, mutual funds, GICs, etc.

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TFSA vs Unregistered Savings Account


  • Unused contribution room may be carried over to the following year. There is no limit as to how much contribution room may be carried forward
  • Withdrawals will be possible at any time and tax-free. Full amount of withdrawals can be re-contributed back into the TFSA in the future
  • No restrictions as to how the money withdrawn is spent.


  • The TFSA provides seniors an alternative savings vehicle to meet ongoing savings needs, once they are required to begin drawing down their RRSP

Low and Modest-Income Canadians

  • Neither withdrawals nor income earned in the TFSA affects income-tested benefits and credits such as Canada Child Tax Benefit, Old Age Security benefit


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