Personal Tax Strategy

Have you opened your TFSA yet?

We’re more than two months into 2009 – a year when the federal government decided to let us invest without asking us to pay taxes on the money we earn.

Canadians 18 or older, can now put up to $5,000 into a Tax-Free Savings Account (TFSA). All investment income (including interest, dividends, and capital gains) earned in a TFSA can grow tax-free, and you can withdraw funds at any time, for any purpose, tax-free.

TFSAs are flexible

You can easily access your funds whenever you need to, and it doesn’t matter what you use the money for: Emergencies, home renovations, vehicle repairs, starting a new business, and so on.

What’s more, the amount you withdraw from your TFSA is not taken into account in determining eligibility for federally sponsored income-tested benefits delivered through the tax system – e.g., Canada Child Tax Benefit, the GST Credit and the Age Credit. It also won’t affect other income-sensitive benefits such as Old Age Security, the Guaranteed Income Supplement or Employment Insurance.

Withdrawals and re-contributions

TFSA savings room is never lost – even on withdrawal. If you withdraw $5,000 from your TFSA, you can re-contribute this amount in a future year without requiring additional contribution room.

Here’s how to start saving “tax-free”

If you are 18 or older, you can now apply for a Mackenzie TFSA. To learn more about the TFSA, see www.mackenziefinancial.com/tfsa.

Or speak with your financial advisor for information on the application process.