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Tax-Free Savings Account (TFSA)

What is a TFSA?

A Tax-Free Savings Account (TFSA) is a powerful registered investment accountyou can use to save for any big-ticket item or goal – tax free. If you like more flexibility and less taxes, consider opening a TFSA.

Here’s why 60% of Canadians invest in a TFSA1:

  • Pay no taxes on any investment earnings4
  • Contribute even if you’re retired or not employed
  • Contribute for as long as you want to—there’s no age limit
  • Make up for missed contribution room from previous years indefinitely
  • Withdraw your money at any time for any reason2
  • Use a TFSA to save for anything while also saving for retirement in an RRSP

Exclusive Benefits When You Invest With RBC

Free Digital Tools to Help You Plan & Save

See all your money in one place, get tips and save automatically with smart tools such as MyAdvisor and NOMI Find & Save.

Advice When You Need It

Speak with an advisor in-person, by phone or over video - whether you're investing $50 or $5,000.

How a TFSA Works

From opening an account—to withdrawing money—here's how a TFSA can help you reach your goals:

A TFSA is a type of registered investment account, which means you can hold income-generating investments in it versus just cash (like a savings account).  

The types of investments you can buy in your TFSA depend on where you open an account. You also want to consider your reasons for investing and your appetite for risk when choosing investments.

  • RBC Royal Bank: ideal if you want investment advice and access to an advisor – in-person, by phone or over video

  • RBC Direct Investing opens in new window : Ideal if you want to make your own investment decisions

    • Offers stocks, options, Exchange-Traded Funds (ETFs), mutual funds, bonds and GICs

  • RBC InvestEase opens in new window : Ideal if you want to invest online and access Portfolio Advisors

    • Offers ETF portfolios designed for different investors (each portfolio holds a diverse mix of ETFs)

Ways to Invest Your Money at RBC

Tip: At RBC, you can open a TFSA with any amount you are comfortable with. Remember to keep the contribution limits in mind.

Since the money you earn from investments you hold in a TFSA (interest, dividends or capital gains) is not taxed, it has the opportunity to grow faster than it would in a non-registered account.

Another way to save faster is by setting up regular (weekly, monthly, etc.) automatic contributions into your TFSA.

  • You decide how much to save and how often—weekly, bi-weekly, monthly—it’s up to you. Be mindful of your available TFSA contribution room when setting up automatic contributions.
  • Contributions are automatically debited from your bank account (at RBC or another financial institution)
  • You can change how much you want to save, how often you contribute, and stop or pause your contributions at any time

While you can take money out of a TFSA for any reason (a car, your wedding, retirement, etc.), your timing does depend on the investments you hold in it. For example, non-redeemable GICs must be held until maturity.

Here are a few other things to know:

  • You won't have to pay tax on money you take out.
  • Withdrawals won’t reduce benefits and credits you’re eligible to receive from the Federal Government, such as Old Age Security (OAS).
  • Withdrawals get added back to your unused contribution room. However, you have to wait until the next year or later to re-contribute these amounts.

One of the best things about a TFSA is you can use it to save for anything you want. For tips and advice to help reach your goals, explore our “how to” guides:

Numbers to Know

$0

Taxes you'll pay on TFSA earnings

$7,000

2024 TFSA contribution limit

$95,000

Maximum TFSA contribution limit3

How Your Money Can Grow in a TFSA vs. a Savings Account

Assumes tax rate of 32% outside of TFSA, with interest income taxed annually. All contributions made at beginning of year. 6% annual compound rate of return. For illustration only and not indicative of future returns. Actual tax rates and rates of return will vary.

TFSA Calculator

How Your Money Can Grow in a TFSA vs. a Savings Account1.

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Your TFSA lifetime contribution limit is $88,000.
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Contribution Rules, Fees & More

TFSA Rules and Contributions

TFSAs are extremely flexible, but there are a few details you should know.

Read More about TFSA rules and contributions

TFSA vs RRSP vs FHSA Account

Deciding between a TFSA and an RRSP or an FHSA account?

Compare Accounts TFSA vs RRSP vs Savings

TFSA Fees

If you wish to transfer your current RBC TFSA to a financial institution outside RBC (and its affiliates), a $150.00 fee will apply.

Learn More about TFSA fees

TFSA FAQs

No. Withdrawals can be made tax-free and will not increase your income for the year. Since withdrawals are not taxed or considered taxable income, there will be no impact to your income-tested benefits and credits from the Federal Government, such as Old Age Security (OAS) and Guaranteed Income Supplement (GIS) or credits such as the Age Credit.

There is a service fee of $150.00 for the transfer of property from a TFSA to a company that is not a subsidiary of Royal Bank of Canada. This fee is subject to change. In the event this fee changes or new fees are introduced, RBC will notify clients by mail or electronically at least 30 days before the effective date of the change.

Any Canadian resident with a Social Insurance Number (SIN) who has reached the age of majority (18 or 19, depending on the province) can open a TFSA. Unlike an RRSP, you do not have to earn an income to make contributions to a TFSA.

Note: If you must wait until age 19 to open a TFSA, your accumulation of contribution room still starts at 18. (This applies to residents of Newfoundland and Labrador, New Brunswick, Nova Scotia, British Columbia, Northwest Territories, Yukon and Nunavut.)

An RBC TFSA can hold a variety of investments, including Guaranteed Investment Certificates (GICs), mutual funds, portfolio solutions and savings deposits. You can also invest in stocks and bonds through RBC Direct Investing® and RBC Dominion Securities. An RBC advisor can help you decide which investments will best serve your needs.

Withdrawals you make in the current calendar year will be added to your unused contribution room. You must wait until the following calendar year or later to re-contribute these amounts.

You can contribute to an existing TFSA:

The limit for 2024 is $7,000, plus any unused contribution room you may have from prior years you were eligible to contribute. Below are the contribution limits for each year since the TFSA was introduced:

Year Contribution Limit Per Year
2009 - 2012 $5,000
2013 - 2014 $5,500
2015 $10,000
2016 - 2018 $5,500
2019 - 2022 $6,000
2023 $6,500
2024 $7,000

Canada Revenue Agency (CRA) tracks and reports this amount through the “My Account” function on the CRA web site external site opens in a new window.

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Invest in a TFSA Today

Choose how you’d like to invest in a TFSA from the following options:

Other Ways to Invest

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RBC Direct Investing

RBC 2021 Financial Independence in Retirement Poll. Findings from the 30th annual RBC RRSP Poll, conducted by Ipsos from December 10 to 17, 2019 on behalf of RBC Financial Planning, through a national survey of 2,000 Canadians aged 18+ who completed their surveys online. Quota sampling and weighting are employed to balance demographics to ensure that the sample's composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ±2.2 percentage points had all Canadian adults been polled. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error.
While you can take money out of a TFSA for any reason, your timing does depend on the investments you hold in it. For example, non-redeemable GICs must be held until maturity.
The maximum contribution room of $95,000 applies if you open your first TFSA in 2024, provided you were at least 18 years old, and a Canadian resident in 2009, and have remained a Canadian resident since then. If you have more than one TFSA, your contribution room is shared across all accounts. It is your responsibility to ensure that you do not exceed your contribution limit each year. If you over-contribute to your TFSA, you may have to pay a penalty tax.
Assets in a TFSA must be Qualified Investments under the Income Tax Act. If the TFSA holds non-Qualified Investments, it could be subject to tax.
Royal Bank of Canada and Royal Mutual Funds Inc. (RMFI) make no warranties, express or implied, as to the accuracy or completeness of the information contained herein.

Royal Bank of Canada and RMFI shall not be liable for any losses or damages arising from any errors or omissions in information contained in this calculator.

Financial planning and investment advice are provided by RMFI. Mutual Funds are sold by RMFI. RMFI, RBC Global Asset Management Inc., Royal Bank of Canada, Royal Trust Corporation of Canada and The Royal Trust Company are separate corporate entities which are affiliated. RMFI is licensed as a financial services firm in the province of Quebec.

Information about the Tax-Free Savings Account is based on what is currently available from the Canadian government and can be subject to change.