Skip to Main Content

New Year, new Tax Free Savings Contribution Limit

Erica Szczech - Jan 12, 2016
Whatever your near or long-term goals, a Tax Free Savings Account (TFSA) can help you reach them sooner. Whether you want to save for the retirment lifestyle of your choosing, family vacation or any other type of adventure, a Tax Free Savings Account

Whatever your near or long-term goals, a Tax Free Savings Account (TFSA) can help you reach them sooner. Whether you want to save for the retirment lifestyle of your choosing, family vacation or any other type of adventure, a Tax Free Savings Account can help you get there faster.

 

In 2015, you could contribute up to $10,000 for the year, an increase from the 2014 limit of $5,500. Effective January 1, 2016, the annual contribution limit dropped back to $5,500 and future contributions will be indexed to inflation. If you have not previously contributed to a TFSA, then you can contribute up to $46,500. This is a great additional savings vehicle for individuals who have maxed out their RRSP contributions or would simply like to use a tax efficient savings vehicle.

 

Tax Free Savings Accounts have many tax planning advantages, some of the benefits are:

  • Reduce your taxes
  • Withdrawal of funds whenever you want
  • No requirement to have earned income
  • Indefinate carry-forwards
  • Save for retirement
  • Save during retirement
  • Split income with your spouse or partner
  • Maintain eligibilty for government programs

For more information on TFSAs and how the savings can really add up, please click here.