The Tax Free Savings Account (TFSA) is an account that provides tax benefits for saving in Canada.  Investment income, including capital gains and dividends earned in a TFSA are not taxed, even when withdrawn.  It is available to Canadian residents 18 years of age and older, have a valid Canadian Social Insurance number and are a resident of Canada.

Starting in 2009, TFSA contribution room accumulates every year.  These are the annual contribution amounts for the following years:

The annual TFSA dollar limit for the years 2009, 2010, 2011 and 2012 was $5,000.

The annual TFSA dollar limit for the years 2013 and 2014 was $5,500.

The annual TFSA dollar limit for 2015 was $10,000.

The annual TFSA dollar limit for 2016, 2017 and 2018 is $5500.

Since the inception of the Tax Free Savings Account in 2009, one significant benefit in the design of the TFSA is the carry-over aspect.  Any unused space under the annual cap can be carried forward to subsequent years, to the maximum contribution entitlement of the account-holder.