Why tax free savings

Borrowing to fund a TFSA is permitted; however, interest expenses related to such a loan are not tax-deductible. All eligible deposits e. These funds are not eligible for deposit insurance offered through the Canada Deposit Insurance Corporation. Advice Connect with a home financing advisor Buying another property Existing homeowners Mortgage renewal First-time homebuyers Renovations Understanding mortgage prepayments and charges Conventional vs.

A savings plan for right now or future years. What is a Tax Free Savings Account? What are the benefits of a TFSA? The TFSA contribution limit is not prorated in the year an individual: turns 18 years old; dies; or becomes a resident or a non-resident of Canada.

How will a TFSA work for me? Here are some ways that you can take advantage of this new savings vehicle: Are you looking to save for a "rainy day"? Tax Deductibility Contributions are not tax-deductible and therefore do not reduce taxable income. Withdrawals Withdrawals are not added to taxable income - they are tax-free. Would contributions and withdrawals have any impact on my eligibility for federal income-tested benefits, such as the Canada Child Tax Benefit and the Guaranteed Income Supplement?

Would the income earned in my spouse's account be attributed back to me? Can TFSA assets be used as security for a loan?

TFSA assets can be used as security for a loan. I've already opened a TFSA. You can name either: A successor, where investments can continue to grow and can be withdrawn tax-free. They can do this without affecting their unused contribution room. This must be done within 30 days after they contribute. Need to change your beneficiary? Need help saving? Let us guide you. An advisor can help put together a solid plan that suits your goals.

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Contact us Contact us Support Talk to an advisor. Legal Privacy Security Accessibility Site map. All rights reserved. Enjoyed this article? Get the latest money and health articles delivered to your inbox. Subscribe to Sun Life's Brighter Life emails for personalized tips, tools and offers. Your first name. Feeling overwhelmed by the account choices when it comes to your savings goals? If a TFSA is the right choice for you, click here to open your account.

The information provided in this article is for general purposes only and does not constitute personal financial or tax advice. Please consult with your own professional advisor to discuss your specific financial and tax needs. There may be commissions, trailing commissions, management fees and expenses associated with mutual fund investments. Please read the prospectus or Fund Facts before investing.

Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. For money market funds there can be no assurances that the fund will be able to maintain its net asset value per security at a constant amount or that the full amount of your investment in the fund will be returned to you.

How much can I save in a tax-free savings account? Can I have more than one tax-free savings account? How can I get maximum benefit from my tax-free savings account?

What happens if I invest more than R36 in tax-free savings accounts? What is the tax year period over which the annual contribution limit on a tax-free savings account applies? The South African tax year runs from 1 March to 28 February of the next year. Can I open a tax-free savings account for my child or other family member? Can I open a tax-free savings account for a family trust or a company?