• To fund your kids' education
  • On your child's wedding
  • For buying a home
  • To fund the healthcare cost
  • For an emergency
  • To fund your retirement
  • TFSAs are a perfect tool for families to save and grow their money tax-free. Since 2009, each year, the government has set a limit on how much you can contribute to your TFSA every year, regardless of income. The contribution limit is $6,000 for 2022.
  • If you didn't contribute to your TFSA in a given year, you can catch up in the future and can carry forward your unused TFSA contribution room indefinitely to future years.
  • Withdrawals are not considered as taxable income because the contributions you made are from your “after-tax" dollars and you will not have to pay tax when you take money out of your TFSA.
  • If you make withdrawals from your TFSA, your contribution room is restored in the following year, so you can re-contribute the amount you withdrew in a future year with no penalties. You can re-contribute your TFSA withdrawals, but not until the next year.
  • Just make sure you plan it properly and don’t go over your yearly contribution limit. If you contributed more than the total allowed limit, the over-contribution amount will be subject to a tax penalty. You can check your TFSA contribution limits on your tax statement or by going to the CRA website and log in to My Account.
  • You can use it as an emergency fund as you can access the money at any time, for any purpose, whenever you need it.
  • You can have more than one TFSA, without creating an over-contribution; because you will have to pay a penalty for over-contribution.
  • You can never lose your TFSA contribution room. If you are just starting a TFSA and have never contributed before, you can also contribute for past years. Your total cumulative contribution limit available in 2022 is $81,500.That means you could contribute up to $81,500 today as shown in the chart.
Year Contribution limit
2009 $5,000
2010 $5,000
2011 $5,000
2012 $5,000
2013 $5,500
2014 $5,500
2015 $10,000
2016 $5,500
2017 $5,500
2018 $5,500
2019 $6,000
2020 $6,000
2021 $6,000
2022 $6,000
Total $81,500
  • You want to save money for an emergency fund.
  • You want to get more returns for your savings.
  • You want to grow your savings without paying taxes on the investment income.
  • You need quick access to your investments whenever you need them.
  • You are working but don't earn enough to qualify for RRSP tax benefits.
  • You want to save your money for medium and long-term projects.
  • You want to save for a specific financial goal like buying a house or for a wedding.
  • You have no more room left in your RRSP contribution account.
  • You want to save in a tax-efficient way for retirement beyond the RRSP contribution limit.