The Tax-Free Savings Account (TFSA) was introduced in Canada 12 years ago. If you’re 18 years of age or older and have a Social Insurance Number, you are eligible for this type of account. TFSAs remain a useful tax shelter and a great complement to an RRSP account, but they are sometimes underutilized and treated as cash savings accounts. There are multiple ways you can put your TFSA to work.
Maximizing your TFSA
A TFSA is often used in conjunction with an RRSP, as both accounts offer different types of tax benefits. However, where an RRSP is most often used singularly for retirement savings, TFSAs can be used to house funds for other types of milestones: a new vehicle, a new home, a vacation, starting a business, and an emergency fund, to name a few.
In a TFSA, earnings (such as interest income, dividends, and distributions) and capital gains are not taxed, making this account a great investment vehicle. TFSAs can hold almost all of the same types of investments as RRSPs—including many types of alternative investments, which are often already structured to be as tax-efficient as possible.
TFSA contribution limit for 2021
The Canadian government recently announced the contribution limit for TFSAs for 2021. The limit for 2021 is $6,000, matching the amount set in the previous two years.
TFSA contribution limits since 2009
The following chart shows TFSA contribution limits since its inception in 2009. The contribution limit accumulates, so if you open a TFSA account in 2021, you may be able to deposit up to $75,500 within the 2021 calendar year.
| Year | Contribution limit |
|---|---|
| 2021 | $6,000 |
| 2020 | $6,000 |
| 2019 | $6,000 |
| 2018 | $5,500 |
| 2017 | $5,500 |
| 2016 | $5,500 |
| 2015 | $10,000 |
| 2014 | $5,500 |
| 2013 | $5,500 |
| 2012 | $5,000 |
| 2011 | $5,000 |
| 2010 | $5,000 |
| 2009 | $5,000 |
Maximizing your TFSA with Skyline Wealth Management
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Skyline Apartment REIT Professionally-managed multi-residential properties in secondary and tertiary Canadian markets |
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Skyline Commercial REIT Professionally-managed light industrial properties along major Canadian transportation corridors, with a focus on logistics and warehousing |
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Skyline Retail REIT Professionally-managed retail properties in secondary and tertiary Canadian markets, with a focus on ‘everyday essential’ brands |
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Skyline Clean Energy Fund A portfolio of professionally-maintained clean energy-producing assets across OntarioWith our experience and insight, we’d be happy to discuss how our private investment products may be a suitable fit for your investment portfolio and how you can maximize your TFSA and other registered accounts. |
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