The Tax-Free Savings Account, or TFSA, is one of the most significant changes to how Canadians save since the arrival of the RRSP.

Unlike an RRSP, contributions to a TFSA are made with after tax dollars but any interest earned is non-taxable. With more flexible features, the TFSA can help you achieve short or long-term goals, from taking that dream vacation to supplementing your retirement savings.

Benefits of a Tax-Free Savings Account

  • Income earned in your TFSA isn't taxed and withdrawals of contributions and earnings from the plan are not taxable, either. This means you keep more of your money!
  • You can withdraw funds from your TFSA at any time and for any purpose. (Keep in mind that transfers or withdrawals may be restricted based on the investment terms you select.)
  • Make contributions to your RRSPs and TFSAs online, and withdraw money from your TFSA as well. Visit Transfers Between Your Accounts to learn how to set up transfers online.
  • You get a choice of investment vehicles, including savings accounts, guaranteed investment certificates and mutual funds.
  • Contribution room is set for each year. You have up to $5,000 in contribution space for each year between 2009 and 2012. The contribution limit for 2013 through 2014 is $5,500 per year. The contribution limit for 2015 is $10,000. For 2016 and 2017, the contribution limit is $5,500.
  • You can enjoy freedom to invest when you can, wait when you can't, and carry forward any unused contribution room indefinitely.
  • Any withdrawals from your TFSA are added to the following year's contribution room, letting you 'replace' whatever you take out.
  • Income or withdrawals from your TFSA won't affect your eligibility for federal income-tested benefits and credits, such as the Guaranteed Income Supplement and the Canada Child Tax Benefit.
  • You can make contributions to your spouse’s TFSA and TFSA assets can be transferred to a spouse upon death.

Regardless of the mix of investments you hold and the kinds of investment income you receive, choosing a TFSA for a portion of your non-registered investments will leave more money in your pocket each year, creating a larger portfolio over time.

To explore how an ACU TFSA can benefit you, please call for an appointment with an ACU financial account manager.

Mutual funds are offered through Credential Asset Management Inc. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Unless otherwise stated, mutual funds and cash balances are not covered by Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.

®Credential is a registered mark owned by Credential Financial Inc. and is used under licence.


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Designation of Beneficiary

Be sure you have decided on and spelled out who should receive your remaining registered savings in the event of your death. And be aware that if you marry or divorce, your Designation of Beneficiary will not be revoked or changed automatically. You must complete a new Designation of Beneficiary form. Don't delay, speak to your account manager soon.