Tax Guide/Saving and investing
The TFSA explained
Updated November 4, 2026
A Tax-Free Savings Account (TFSA) gives no deduction, but growth and withdrawals are tax-free. Despite the name, it can hold investments as well as savings.
| 2026 details | |
|---|---|
| Annual limit | $7,000 |
| Total room if eligible since 2009 | $109,000 |
| Withdrawal effect | The amount returns to your room the next January 1 |
Income from a TFSA does not affect benefits or the OAS recovery tax.
Re-contributing a withdrawal in the same year without enough room can lead to a tax of 1% a month on the excess. Trust your own records, because the CRA's figure may not include this year's activity.