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Kickstart your next short-term savings goal.
A Tax Free Savings Account (TFSA) is a registered account that helps you save and invest for a wide range of goals. Any investment growth or withdrawals from your TFSA aren’t taxed, giving you flexibility in how and when you use your money.
A TFSA can be used for short-term savings, longer-term investing, or alongside other registered accounts as part of a broader plan.
Most Canadian residents age 18 and over can open and contribute to a TFSA. You don’t need earned income to be eligible.
Investment growth and withdrawals in a TFSA aren’t taxed. TFSA withdrawal rules allow access at any time, with the amount restored to your contribution room the following year.
The annual contribution limit is set by the government each year. Any unused contribution room carries forward and can be used in future years. The 2026 annual contribution limit is $7,000.
At Mainstreet, eligible deposits in registered accounts have unlimited coverage through the Financial Services Regulatory Authority (FSRA).
Who should consider a TFSA?
A TFSA may be a good fit if you’re saving for goals that could come up before retirement and want flexibility in when you access your money. It’s often used for short-term savings, but it can also support longer-term investing or complement other registered accounts.
A Mainstreet advisor can help you understand how a TFSA fits into your overall plan and how it can work alongside accounts like an RRSP.
A TFSA can hold a variety of investments, including high interest savings accounts, GICs, stocks*, bonds*, ETFs*, mutual funds*, or self-directed investments**. Depending on what you choose, your TFSA may earn interest at competitive TFSA rates or generate long-term investment growth.
Advisor Managed Investing
Advisor-Managed Investing offers guidance and a plan built around your goals. A Mainstreet advisor helps you choose and manage investments and adjusts your approach as your needs change.
Qtrade Direct Investing®
Qtrade Direct Investing gives you the flexibility to manage your savings and investments independently, using tools and resources to stay in control.
*Mutual funds and other securities are offered through Aviso Wealth, a division of Aviso Financial Inc. Unless otherwise stated, mutual funds, other securities and cash balances are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions.
**Online brokerage services are offered through Qtrade Direct Investing, a division of Aviso Financial Inc.
TFSAs and RRSPs are both registered accounts that help you save, but they differ in how contributions, taxes, and withdrawals work.
|
TFSA |
RRSP |
|
|---|---|---|
|
Purpose |
Flexible savings for short- or long-term goals. |
Saving primarily for retirement income. |
|
Eligibility |
Canadian residents age 18 and over can open and contribute to a TFSA. No earned income is required. |
Canadian residents with earned income can contribute to an RRSP until age 71. |
|
Contribution limit |
Set by the government each year ($7,000 for 2026). Unused contribution room carries forward. |
18% of previous year’s earned income, up to $32,490 (2026 limit). Unused room carries forward. |
|
Tax treatment on contributions |
Contributions are not tax-deductible. |
Contributions reduce taxable income. |
|
Withdrawal rules |
Withdrawals are tax-free and are added back to contribution room the following calendar year. |
Withdrawals are taxable as income. |
|
Contribution deadline |
December 31 of the calendar year. |
Up to 60 days into the following year. |
|
Mandatory withdrawals |
None. |
Must convert to a RRIF by age 71 and begin withdrawals. |
|
TFSA |
RRSP |
|---|---|
|
Purpose |
|
|
Flexible savings for short- or long-term goals. Saving primarily for retirement income. |
|
|
Eligibility |
|
|
Canadian residents age 18 and over can open and contribute to a TFSA. No earned income is required. Canadian residents with earned income can contribute to an RRSP until age 71. |
|
|
Contribution limit |
|
|
Set by the government each year ($7,000 for 2026). Unused contribution room carries forward. 18% of previous year’s earned income, up to $32,490 (2026 limit). Unused room carries forward. |
|
|
Tax treatment on contributions |
|
|
Contributions are not tax-deductible. Contributions reduce taxable income. |
|
|
Withdrawal rules |
|
|
Withdrawals are tax-free and are added back to contribution room the following calendar year. Withdrawals are taxable as income. |
|
|
Contribution deadline |
|
|
December 31 of the calendar year. Up to 60 days into the following year. |
|
|
Mandatory withdrawals |
|
|
None. Must convert to a RRIF by age 71 and begin withdrawals. |
|
Whether you're saving for a home, a renovation, or long-term investing, a TFSA can be part of your plan.
Contribution room is the amount available to you to add money or securities up to a specific value. The total amount you can contribute to a TFSA (assuming you were 18 or older and a resident of Canada in 2009) is $109,000.
If you turned 18 after 2009, contribution room starts the year you turn 18, or the year you became a Canadian resident and accumulates every year after. The annual contribution room increase can change, you can find information about the annual dollar limit from the Canada Revenue Agency.
A TFSA is a registered account that you can open and contribute to. Contributions are generally invested in things like high interest savings accounts, GICs/term deposits, stocks*, ETFs*, and bonds*. Any growth on these investments is tax-free.
Contribution room depends on a number of factors, such as how old you are and when you became a Canadian resident. While contribution room is cumulative, it is important to remember that if you withdraw funds in a calendar year, that room cannot be accessed until the following calendar year. You can view your TFSA room in your MyCRA Account.
