TFSAs - Tax-Free Savings Accounts
The TFSA is a Tax Free Savings Account that was made available as of 2009. The TFSA is a flexible, general purpose savings vehicle where interest and income earned is protected from taxation, even when withdrawn. UCU offers this product as either a savings account or term deposit.*
Key benefits of the Tax-Free Savings Account:
- Available to Canadian residents only, who are 18 years or older and hold a valid Social Insurance Number (SIN)
- The maximum annual contribution limit for 2024 is $7,000.00 tax-free
- As of January 1, 2024, the maximum lifetime contribution for someone who has never contributed and has been eligible for the TFSA since its introduction is $95,000. The maximum for 2023 is $88,000.
- Any unused contribution room can be carried forward to future years
- Withdraw money without being taxed
- The withdrawn amounts can be re-contributed at any time after the year of withdrawal
- Neither income earned in a TFSA nor withdrawals will affect eligibility for federal income-tested benefits and credits
- TFSA contributions are not tax deductible
Services Charges associated with registered products
Knowing how much you can contribute is an important first step in avoiding a TFSA penalty. For the most up-to-date information on your TFSA contribution room, access the "My Account" feature on the CRA website or by calling the CRA Tax Information Line at 1.800.267.6999.
For better understanding of the implications of TFSA withdrawals, have a look at the two withdrawal scenarios the CRA has provided on the CRA website.
*Subject to the terms, conditions, redeemability, and penalties that may apply to the specific types of deposits or investments held within the TFSA.
