TFSA


TFSA made easy - Everything you needed to know


Tax Free Saving Account [TFSA] is one of the most tax efficient ways to Plan and Build your investments properly. TFSA is an account and not an investment by itself. You or your advisor has to choose the right investments options according to your goals, objectives, when you need the investments and most importantly, at the risk level that you can afford to take. Managing investments such as ETF, Stocks or Mutual Funds is crucial for the growth of your investments and your success.

 

TFSA introduced by the Government of Canada in 2009


TFSA is one of the popular tax-free saving investment options introduced by the Government of Canada in the year of 2009. It is open to any Canadians over the age of 18 years. Currently you can contribute $5500 annually and the money grows tax-free within the TFSA. Importantly you can take out the money from this account without any penalty at any time.

If you haven’t contributed in a TFSA until now, you can deposit up to $ 57,500 as of 2018.

 

Useful TFSA Facts:


Year             Annual Limit             Total

2009 to 2012              $5,000                        $20,000

2013, 2014                 $5,500                        $11,000

2015                           $10,000                      $10,000

2016 to 2018              $5,500                        $16,500

 

Three key reasons why you need TFSA

  • If you are looking for tax efficient investment planning to reduce your overall tax
  • Have a strategic way to grow your tax-free retirement income
  • Build and grow your emergency fund.

 

To find how this can help you fit with your financial goal and tax efficient investment planning, contact our qualified investment consultant today


Caution:


  • If you max out your RRSP, you have to plan carefully where to hold your Canadian dividend paying stock and US dividend paying stocks
  • Canadians will get an advantage when they invest in Canadian stocks as dividend tax credit. Plus, the US will withhold the tax of 15%, when US dividends are paid to Canadian residents
  • Generally it’s best to keep the US Dividend paying stock inside the RRSP compared to investing in TFSA
  • This is not a Savings Account
  • Know your limits
  • You need to know when you withdraw and redeposit into the account, otherwise you will get a penalty and an additional punitive tax from CRA
  • You need to know where your TFSA is invested in. If not, you will lose a lot of opportunity to grow your wealth.




Contact our Qualified LifePlan Consultant or Financial Planner Today.


Our qualified consultants will take the time to review your current investment account and see if your investments holding have the right asset allocation and are managed according to your risk tolerance.