Prairie Centre Credit Union
A Fresh Approach to Savings
The Federal Government has introduced a new registered savings account that allows taxpayers to earn investment income tax-free. The Tax-Free Savings Account (TFSA) is now available to Canadian Residents age 18 or older. TFSA allows taxpayers to set money aside in eligible investment vehicles and watch those savings grow tax-free throughout their lifetime.
There are no restrictions on the way TFSA funds (contribution and earnings) may be used (i.e. purchase a car, renovate a home, start a small business, take a family vacation, or just save for 'a rainy day'). All income levels and all walks of life can benefit from a TFSA. But only a careful review of each person's financial situation will determine how to optimize use of RRSPs, RESPs, RRIFs and TFSAs.
TFSA Contribution Limit
Contribution to a TFSA may only be made by the Holder and the amount is not tied to the income of the Holder.
The individual owning the TFSA is the 'Holder'. Any individual person (not trusts or corporations) who meets all of the following three requirements is eligible to open a TFSA:
There is no maximum age limit to open or hold a TFSA and a person may hold more than one TFSA.
The types of eligible investments are restricted under the Income Tax Act and include:
When a TFSA Holder contributes less than the maximum contribution limit, the difference is referred to as "unused contribution room".
*Mutual funds are offered through Credential Asset Management Inc. and mutual funds and other securities are offered through Credential Securities Inc. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Unless otherwise stated, cash balances, mutual funds and other securities are not convered by the Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions. Mutual funds and other securities are not guaranteed, their values change frequently and past performance may not be repeated. Credential Securities Inc. is a Member - CIPF.