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Investment FAQs

Tax-Free Savings Account (TFSA)

Select Category: General Opening Account Contributions Withdrawals

General

A Tax-Free Savings Account (TFSA) is a registered account with CRA introduced in 2009. You can use a TFSA to save for any short- or long-term goal—a new car, a home, a rainy day or retirement. Investment earnings and withdrawals are tax-free, so your money grows faster!

Any Canadian resident with a Social Insurance Number (SIN) who has reached the age of majority (18 or 19, depending on the province) can open a TFSA. Unlike an RRSP, you do not have to have earned an income to make contributions to a TFSA.

Note: If you must wait until age 19 to open a TFSA, your accumulation of contribution room still starts at 18. (This applies to residents of Newfoundland and Labrador, New Brunswick, Nova Scotia, British Columbia, Northwest Territories, Yukon and Nunavut.)

An RBC TFSA can hold a variety of investments, including Guaranteed Investment Certificates (GICs), mutual funds, portfolio solutions and savings deposits. You can also invest in stocks and bonds through RBC Direct Investing™ and RBC Dominion Securities. An RBC advisor can help you decide which investments will best serve your needs.

No. Investment income and withdrawals from a TFSA are not included as income for tax purposes, which means they will not affect your eligibility for Federal income-tested government benefits and credits such as the Canada Child Tax Benefit, the Working Income Tax Benefit, the Guaranteed Income Supplement, Old Age Security (OAS) or the Goods and Services Tax (GST) credit.

Opening Account

You can open a new TFSA:

Contributions

Below are the contribution limits for each year the TFSA has been around:
Year Contribution Limit Per Year
2009 - 2012 $5,000
2013 - 2014 $5,500
2015 $10,000
2016 - 2018 $5,500
2019 - 2022 $6,000
2023 $6,500
2024 $7,000

Yes. If you are eligible to contribute, your unused contribution room can be carried forward indefinitely and there is no limit on how much contribution room you can accumulate.

For example, if you contribute $3,000 to your TFSA in 2023, your contribution room for 2024 will be $10,000 ($3,000 carried forward from 2023 plus $7,000 for 2024). This assumes that you have maximized your annual allowable contribution for all previous years).

Similar to an RRSP, a penalty will be assessed by Canada Revenue Agency (CRA) of 1% per month on your excess contribution.

Canada Revenue Agency (CRA) tracks and reports this amount through the “My Account” function on the CRA web site.

You can set up pre-authorized contributions (PACs) through the RBC Mobile app or RBC Online Banking.

To use the RBC Mobile app, sign in and follow the steps below:

  • From the Accounts screen, tap your TFSA.
  • Select “Set Up Pre-Authorized Contribution.”
  • Follow the on-screen instructions to complete your transaction.

To use RBC Online Banking, sign in and follow the steps below:

  • From the Accounts Summary page, click your TFSA.
  • Select “Contribute” from the left-hand menu of the TFSA Account Holdings page.
  • Follow the on-screen instructions to complete your transaction.

Try the TFSA calculator to see the benefits of regular, ongoing contributions.

Yes, you can redeem your Avion® points to make a contribution to an RBC Royal Bank Registered Retirement Savings Plan (RRSP), Registered Education Savings Plan (RESP), Tax-Free Savings Account (TFSA) or Registered Disability Savings Plan (RDSP). Visit www.rbcrewards.com for details.

Funds will be available on the next business day following the date on which you have instructed us to redeem your GIC, or in the case of RBC Income Builder GIC, following the date on which a payment is made from the GIC.

Other Notable Disclosures:

  • Interest in a GIC will be calculated counting the first but not the last day of the term.
  • There is no fee charged for a purchase of GIC. If you transfer your GIC out to another financial institution, there will be a transfer out fee of $150 charged (applies to both registered or non-registered GICs – transfer out fee for non-registered GICs came into effect August 1, 2022)
  • You may provide us with instructions as to what to do with your GIC proceeds upon maturity. If your GIC is automatically renewed, you may cancel it upon renewal within 10 business days from the issuance (renewal) date, and if you do, your principal will be returned, but no interest will apply from the issuance to the cancellation date.
  • The GIC Client Agreement can be found at https://www.rbcroyalbank.com/dms/investments/clientacknowledgementforms.html. This GIC Client Agreement may be changed at any time, on notice to GIC holders.
  • For more information and disclosures regarding RBC Equity Linked GICs, see: RBC Equity-Linked GICs page.

Mutual Funds are sold by Royal Mutual Funds Inc. (RMFI). There may be commissions, trailing commissions, management fees and expenses associated with mutual fund investments. Please read the Fund Facts/prospectus before investing. Mutual fund securities are not insured by the Canada Deposit Insurance Corporation. For funds other than money market funds, unit values change frequently. For money market funds, there can be no assurances that a fund will be able to maintain its net asset value per security at a constant amount or that the full amount of your investment in a fund will be returned to you. Past performance may not be repeated. RMFI is licensed as a financial services firm in the province of Quebec.


Financial planning services and investment advice are provided by Royal Mutual Funds Inc. (RMFI).  RMFI, RBC Global Asset Management Inc., Royal Bank of Canada, Royal Trust Corporation of Canada and The Royal Trust Company are separate corporate entities which are affiliated. RMFI is licensed as a financial services firm in the province of Quebec.