The good news is that they also allow us to put money back in easily. But keep the rules in mind or face the tax consequences.
TFSAs are a useful savings vehicle: Any amount contributed as well as any income earned in the account, such as interest income or capital gains, is generally tax-free, even when it is withdrawn. Plus, there are no restrictions on the amount or the timing of your withdrawals.
Even better, when you withdraw funds from your TFSA, you do not lose your contribution room and you can put that money back in. But there are rules regarding re-contributions.
Generally, the rule is that the amount of your withdrawal from your TFSA will be added back to your TSFA contribution room the following year. If you want to replace the money you withdrew, you’ll need to wait for the new year. The exception is that if you have unused contribution room from previous years, you can replace that money sooner as long as you stay within your available contribution room.
Insurance products and services are offered by life insurance licensed advisors through Chevron Wealth Preservation Inc., a wholly owned subsidiary of Echelon Wealth Partners Inc. This material is provided for general information and is not to be construed as an offer or solicitation for the sale or purchase of life insurance products or securities mentioned herein. Every effort has been made to compile this material from reliable sources however no warranty can be made as to its accuracy or completeness. Before acting on any of the above, please seek individual financial advice based on your personal circumstances. Please note that only Echelon Wealth Partners is a member of CIPF and regulated by IIROC; Chevron Wealth Preservation is not.
Forward-looking statements are based on current expectations, estimates, forecasts and projections based on beliefs and assumptions made by author. These statements involve risks and uncertainties and are not guarantees of future performance or results and no assurance can be given that these estimates and expectations will prove to have been correct, and actual outcomes and results may differ materially from what is expressed, implied or projected in such forward-looking statements.
The opinions expressed in this report are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Echelon Wealth Partners Inc. or its affiliates. Assumptions, opinions and estimates constitute the author’s judgment as of the date of this material and are subject to change without notice. We do not warrant the completeness or accuracy of this material, and it should not be relied upon as such. Before acting on any recommendation, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Past performance is not indicative of future results. These estimates and expectations involve risks and uncertainties and are not guarantees of future performance or results and no assurance can be given that these estimates and expectations will prove to have been correct, and actual outcomes and results may differ materially from what is expressed, implied or projected in such forward-looking statements. Echelon Wealth Partners Inc. is a member of the Investment Industry Regulatory Organization of Canada and the Canadian Investor Protection Fund.
All Rights Reserved | Ottawa Wealth Management
Please note that only Echelon Wealth Partners is a member of CIPF and regulated by IIROC; Chevron Wealth Preservation Inc. is not. *Insurance Products provided through Chevron Preservation Inc.