TFSA (Tax Free Saving Account) is offered by IB Canada for Canadian residents only.
A Tax-Free Savings Account (TFSA) allows customers to set money aside tax-free throughout their lifetime. Each calendar year, customers can contribute up to the TFSA dollar limit for the year, plus any unused TFSA contribution room from the previous year, and the amount withdrawn the year before.
No account maintenance fee.
Withdrawals out of TFSA are not subject to additional account specific charges and are only available in CAD.
Existing eligible IB customers may open the TFSA as a linked account from Account Management. Under the heading of Manage Account, Add or Link Accounts, Create Linked Accounts, and TFSA as account type.
A customer must be a Canadian resident in order to open a TFSA
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Penalty of 1% per month would be assessed by CRA on excess contribution
No trading on margin - all purchases must be paid in full in respective currencies; No account debit allowed. If needed, currency trade could be executed between USD & CAD.
Accounts are restricted to cash balances in CAD and USD.
TFSA is allowed to trade the following qualified investments:
A TFSA account is considered part of a customer’s general account for purposes of CIPF coverage. Therefore, a TFSA will be combined with other (Non-RSP) IB accounts eligible for $1 million coverage.
A TFSA account holder can designate the spouse or common law partner as the successor holder of the account. This means that up the death of the original holder, the spouse/common law partner becomes the new account holder.
If the account holder chooses not to designate his or her spouse or common law partner as successor holder, then a beneficiary could be named.
Successor holder nomination is not available for QC based TFSA accounts.