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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
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)
Withdrawal limit 
None

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
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