Investing

TD makes it easy to save

At TD, you’ll find a wide range of Tax-Free Savings Accounts (TFSAs) to help you save money. Whether you’re putting money aside for a down payment on a house, saving for a major purchase like a car or a vacation, building your rainy day fund or making sure you have enough for a comfortable retirement, a TFSA can help.

What types of TFSAs are available?

• High Interest TFSA Savings Account

  The High Interest TFSA Savings account helps you build your savings tax-free.
  The highlights:
  

  • Competitive interest rate for tax-free growth
  • Steady, predictable returns
  • Easy access to your money
  • Ability to make contributions with Pre-Authorized Transfer Service

  Open a TFSA today

  • Visit any TD Canada Trust Branch
  • Or call 1-866-222-3456 to discuss your options

  Apply Now

  
  
  

  Tax-Free Savings Account

  High Interest TFSA Savings Account

  Account Balance	Interest Rate
  $0 to $999.99	1.15%
  $1,000 to $4,999.99	1.15%
  $5,000 to $9,999.99	1.15%
  $10,000 to $24,999.99	1.15%
  $25,000 to $59,999.99	1.15%
  $60,000 and over	1.15%

  Interest is payable monthly at the rates per annum, as offered. Interest for each tier is paid on your total daily closing balance.

  
  
• 
  GICs and Term Deposits

  Guaranteed Investment Certificates (GICs) and Term Deposits are a safe and secure investment option for your TFSA and the interest you earn is not taxed.

  The highlights:
  

  • Your principal is fully protected
  • The interest you earn is not taxed
  • Choose from fixed rates or Market Growth GICs³
  • Your investments give you steady, predictable returns³ A full range of terms, features and premium rates with investment flexibility
  • No fees

  Learn More
  
  

  Open a TFSA today

  • Visit any TD Canada Trust Branch
  • Or call 1-866-222-3456 to discuss your options

  
  Apply Now
  
  
  
• TD Mutual Funds TFSA

  A Tax-Free Savings Account (TFSA) is a great place to purchase investments like mutual funds because you don’t pay any tax on the income you earn on your investment.

  The highlights:
  

  • Gain access to a wide range of investments that would otherwise be difficult and time-consuming to purchase and manage individually
  • Actively managed mutual funds give you the benefit of professional investment management
  • You have the option to choose TD Comfort Portfolios for a convenient all-in-one investment solution

  Learn More
  
  

  Open a TFSA today

  • Visit any TD Canada Trust Branch
  • Or call 1-866-222-3456 to discuss your options

  
  Apply Now
  
  
  
• TD Waterhouse TFSA

  A TD Waterhouse TFSA puts the power of saving your money in your hands.

  The highlights:
  

  • Self-directed accounts
  • Flexibility to hold a range of investments in one account

  Learn more
  
  

  Open a TFSA today

  • Visit any TD Canada Trust Branch
  • Or call 1-866-222-3456 to discuss your options

  
  Apply Now
  
  
  

Where to put your savings?

Whether your savings goal is for a comfortable retirement, homeownership or education, both RSPs and TFSAs can be a good option. To learn more take a look at the comparison chart below:

The difference between TFSAs and RSPs

Open a TFSA today

• Visit any TD Canada Trust Branch
• Or call 1-866-222-3456 to discuss your options

Have a few questions?

We’ve provided answers to some of the most common questions people have about TFSAs. Take a look below to find helpful information.

About TFSAs

• 1. What is a Tax-Free Savings Account (TFSA)?

  A Tax-Free Savings Account (TFSA) is a registered savings account regulated by the federal government. Through a TFSA, you can put your savings into eligible investments and not pay tax on the investment income you earn.

• 2. Who is eligible for a TFSA?

  The idea behind TFSAs is to make the benefits of tax-free savings available to as many Canadians as possible. For that reason, TFSAs are available to every Canadian resident who is 18 years of age or older and has a Social Insurance Number (SIN). However, to open a TFSA at TD Canada Trust, you must have achieved age of majority in the province in which you live. So, if you live in British Columbia, Newfoundland and Labrador, Nova Scotia or New Brunswick, then you can’t actually open a TFSA until you are 19, which is the age of majority in those provinces. However, you will accumulate contribution room from the time you are 18.

• 3. How is a TFSA different from an RSP?

  An RSP is designed specifically to provide you with income after you retire. Your contribution limit is based on your income and the contributions you make are tax-deductible, but you do pay tax on the money when you receive it as income. A TFSA is not designed specifically for retirement, but to help you save money for a wide range of goals. The amount you can contribute is not based on your income and your contributions are not tax-deductible. You can withdraw your money any time you want it, and you don’t pay tax on those withdrawals. You also don’t lose contribution room when you make a withdrawal – you can re-contribute the amount withdrawn to your TFSA in the following year or any year after that.

Contributions

• 4. How much can I contribute?

  As of January 2, 2009, you can contribute up to $5,0001 a year to your TFSA. However, that contribution limit is indexed to inflation, which means that it will rise with the cost of living.

• 5. What if I can’t contribute the full $5,000?

  You can carry forward any uncontributed amounts into future years indefinitely. So, for example, if you contributed only $2,000 in 2009, in 2010, you could contribute up to $8,000 (the $5,000 limit for 2010, plus the $3,000 you had left over from 2009).
  If, in 2010, you contributed $5,000, you could carry the $3,000 left over from 2009 to 2011 and on through the years until you use it.

• 6. How will I know what my contribution limit is for each year?

  Every year, the government will calculate how much TFSA contribution room you have available. You will be informed of your contribution limit when you receive your T1 Notice of Assessment.

• 7. Can I contribute more than my limit in a particular year?

  If you contribute more than your contribution limit, you will pay a penalty of 1% per month on the excess amount.

• 8. Can I make spousal contributions to my spouse’s TFSA?

  No, you can’t contribute directly to your spouse’s TFSA as you can with a spousal RSP. However, you can give your spouse money, which they can then contribute to their own TFSA. Any income your spouse earns on the money in their TFSA is theirs and will not be attributed back to you.

Withdrawals

• 9. When can I withdraw my money?

  You can withdraw funds from your TFSA any time you want – you don’t have to reach a certain age before you withdraw your money.

• 10. Do I have to pay income tax on my withdrawals?

  No, you don’t have to pay tax on the amounts you withdraw.
  Because TFSA withdrawals don’t count as taxable income, they don’t affect Federal income-tested benefits or tax credits you may receive, including the Canada Child Tax Benefit, the Working Income Tax Benefit, the Goods and Services Tax Credit and the Age Credit. TFSA withdrawals also won’t reduce benefits based on your income level, such as Old Age Security, the Guaranteed Income Supplement and Employment Insurance benefits.

• 11. What can I spend the money on?

  Anything you want. You could wait until you retire and use it to supplement retirement income you have from pensions, RSPs or other sources, but you can also use it for short-term savings goals like a new car or a vacation, or for needs that arise suddenly like repairs to your home.

• 12. Once I’ve withdrawn my money, is that contribution room lost?

  No, you never lose your contribution room – in fact, you can recontribute amounts you have withdrawn. You have to wait until the next year to recontribute, but you can carry forward the recontribution room indefinitely.
  For example, say you contribute $5,000 to your TFSA in January 2009 and another $5,000 in January 2010. Then, in the summer of 2010, you withdraw $3,000 to pay for some repairs to your home. You can’t recontribute that $3,000 in 2010, but in 2011 it will be added to your contribution room again, meaning you could contribute up to $8,000 in 2011.

• 13. Are there any restrictions on withdrawals?

  No, you can take out as much of your money as you want, whenever you want², and use it for anything you choose.

Taxation

• 14. Do I have to pay tax on my money?

  No, you don’t pay any tax on the investment income you earn in the account, and you don’t pay income tax on the amounts you withdraw.

• 15. Are my contributions tax-deductible, like RSP contributions?

  No, you can’t deduct contributions to your TFSA from your income as you can with your RSP contributions.

Investments

• 16. What kind of investments can I hold in my TFSA?

  You can hold many of the same investments you hold in your RSP in your TFSA, including mutual funds, GICs, stocks and bonds.
  Note: The above information about the Tax-Free Savings Account is based on the information currently available from the Canadian government. To learn more or to check for updates, visit the TFSA information page on the Canada Revenue Agency website.