Quick overview
Quick overview A tax-free savings account (TFSA) lets you grow your savings tax-free for your goals.
Quick overview A registered retirement savings plan (RRSP) lets you reduce your taxable income so you pay less tax.
Quick overview A first home savings account (FHSA) lets you save tax-free for a down payment.
Ideal for
Ideal for - Saving for your goals
- Building an emergency fund
- Topping up your retirement savings
Ideal for - Saving for retirement
- Buying a qualifying home (using the HBP)
- Going back to school (using the LLP)
Ideal for - Buying or building your first home
Key benefits
Key benefits You can keep your TFSA open into retirement and continue growing your money. Since your withdrawals aren't taxed and have no impact on your government benefits, a TFSA is a good source of additional retirement income.
Key benefits Since RRSP contributions reduce your taxable income, you could get a tax refund and increase your government benefits, such as family allowances and tax credits.
Key benefits If you don't end up buying or building a home, your FHSA will be closed after 15 years and the funds will be transferred to your RRSP tax-free. In this case, your FHSA can give you an additional $40,000 in RRSP contribution room.
Eligibility
Eligibility - You're 18 or over
- You have a valid Social Insurance Number (SIN)
Eligibility - You're under 71
- You have a valid Social Insurance Number (SIN)
- You've filed a tax return
Eligibility - You're between 18 and 71
- You're a Canadian resident
- You haven't owned a primary residence you were living in the year before the account was opened or during the previous 4 calendar years
Government grants available
Government grants available None
Government grants available None
Government grants available None
Contribution limit
Contribution limit $7,000 for 2024
Contribution limit 18% of the income you earned the previous year, up to $31,560 for 2024
Contribution limit $8,000 per year, up to a lifetime limit of $40,000
Tax-deductible contributions
Tax-deductible contributions No
Tax-deductible contributions Yes
Tax-deductible contributions Yes
Taxes on investment income
Taxes on investment income None
Taxes on investment income No, as long as the money stays in the plan
Taxes on investment income None
Accumulate contribution or grant room
Accumulate contribution or grant room Each year from when you turn 18 and you're living in Canada
Accumulate contribution or grant room Each year since 1991, until age 71
Accumulate contribution or grant room Each year, up to $16,000 per year
Withdrawal limit
Withdrawal limit None, unless you use the money to buy a home (HBP) or go back to school (LLP)
- $60,000 if you use the money to buy your first home (HBP)
Taxes on withdrawals
Taxes on withdrawals None
Taxes on withdrawals Yes, unless you use the money to buy your first home (HBP) or go back to school (LLP)
Taxes on withdrawals None if the money is used to buy or build a qualifying home
Pay back amount withdrawn
Pay back amount withdrawn No
Pay back amount withdrawn No, unless you use the money to buy your first home (HBP) or go back to school (LLP)
Pay back amount withdrawn No
Withdrawals added back to contribution room
Withdrawals added back to contribution room Yes, added back for the following year
Withdrawals added back to contribution room No
Withdrawals added back to contribution room No
Impact on government benefits and credits
Impact on government benefits and credits None
Impact on government benefits and credits - Your contributions reduce your taxable income and could increase your credits and allowances.
- Withdrawals are added to your taxable income and might affect your benefits and credits, such as the Old Age Security pension or GST/HST credit.
Impact on government benefits and credits - Contributions reduce your taxable income and might make you eligible for certain credits and allowances.
- Non-qualifying withdrawals are added to your taxable income and might affect your government benefits or credits.
End of plan
End of plan - Upon death
- By December 31 of the year you turn 71, your RRSP should be converted to a RRIF or used to purchase an annuity
End of plan When all the funds are withdrawn
Otherwise, your FHSA must be closed by one of the following dates, whichever comes first:
- December 31 of the 15th year after opening it
- December 31 of the year you turn 71
- December 31 of the year after the first qualifying withdrawal
- Upon death
Contribute to spouse's or common-law partner's plan
Contribute to spouse's or common-law partner's plan No
Contribute to spouse's or common-law partner's plan Yes, you can contribute to your spouse's or common-law partner's RRSP and deduct the amount from your taxable income.
Contribute to spouse's or common-law partner's plan No
Contribute using BONUSDOLLARS
Contribute using BONUSDOLLARS Yes
Contribute using BONUSDOLLARS Yes
Contribute using BONUSDOLLARS No
