What happens if i withdraw money from my tfsa

Please note that the answers to the questions are for information purposes only for the products discussed. Individual circumstances may vary. In case of discrepancy, the documentation prevails.

How can we help you? Ask Us. Helpful Related Questions. Q: Do I have to pay income tax on my withdrawals? A: 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.

A: No, you never lose your contribution room — in fact, you can recontribute amounts you have withdrawn.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. Annual TFSA contribution limit is subject to change by the federal government.

The penalty will be calculated on a monthly basis until the excess amount is withdrawn. Q: Do I have to pay tax on my money? Q: Are my contributions tax-deductible, like RSP contributions? Note: The above information about the Tax-Free Savings Account is based on the information currently available from the Canadian government. For more information about the TFSA and how you can reach your savings goals, call us at.

TFSA vs. Share this article Twitter. View details. Looking for advice? We can help. Book an appointment. Here are some ways that you can take advantage of this new savings vehicle:. Are you looking to save for a "rainy day"? A TFSA is an ideal all-purpose savings account that offers complete flexibility to save for a multitude of uses in one registered account.

Your savings build up over time — tax-free - helping you reach your goals sooner, and you can withdraw your money when you need it. Do you have non-registered investments? Have you maximized your RRSP? A TFSA is an excellent choice if you have non-registered investments. The TFSA allows you to turn taxable income into tax-free income for life, by creating a more tax-efficient investment portfolio and enabling you to maximize your investment growth.

You can contribute to a TFSA for a spouse or other family member. Spousal attribution rules don't apply as they would with an RRSP. Are you retired or earning a pension income?? It provides the ability to permanently tax-shelter non-registered GIC interest income. Please consult your financial advisor for specific details on investment availability. Contribution limit is based on an individual's earned income from the previous year, up to a maximum amount e. Contributions are not tax-deductible and therefore do not reduce taxable income.

Contributions are tax-deductible and therefore reduce taxable income. Withdrawals are not added to taxable income - they are tax-free.