TFSA Calculator
Canada’s best deal: growth you never pay tax on. See what your tax-free savings account becomes with the 2026 C$7,000 annual limit.
Your inputs
Balance growth over time
What is a TFSA?
A Tax-Free Savings Account is a registered account where your money grows completely free of Canadian tax — no tax on interest, dividends, or capital gains, and no tax when you withdraw. Despite the name, it is an investment account, not just a savings account: inside a TFSA you can hold stocks, ETFs, bonds, GICs, and mutual funds. The “tax-free” part is the wrapper, not the investment.
The catch is contribution room. The CRA sets an annual dollar limit — C$7,000 for 2026, unchanged from 2024 and 2025 — and every dollar you deposit (not what it grows into) counts against your lifetime room. Room starts accumulating the year you turn 18, unused room carries forward forever, and if you were eligible since the TFSA launched in 2009 and never contributed, you are sitting on C$109,000 of room right now.
The math behind this calculator
Your monthly contribution is capped at the annual limit (C$7,000 ÷ 12 ≈ C$583/month) — the calculator will tell you if the cap kicked in. Then it compounds monthly: each month your balance grows by one-twelfth of the annual return, and the month’s contribution is added. Because TFSA growth is never taxed, the number you see is the number you keep.
Each month: balance = balance × (1 + r/12) + monthly contribution
Worked example
Contribute C$500 a month (C$6,000 a year — under the cap) for 20 years at 7%. You put in C$120,000 and the account reaches roughly C$260,000. More than half — about C$140,000 — is pure compounding, and every dollar of it is tax-free on withdrawal. Push the contribution to C$700 a month and the annual cap bites: only C$7,000 a year actually goes in, for a total of C$140,000 contributed and about C$304,000 at the end.
Caveats worth knowing
- Over-contributions are punished monthly. 1% per month on the excess, with no buffer. Track your room yourself — CRA records can lag.
- Withdrawals restore room next year, not today. Take money out in 2026 and that room comes back on January 1, 2027.
- Non-residents beware. Contributing while a non-resident triggers a 1% monthly tax. And the US does not recognize the TFSA — American citizens face IRS tax on TFSA gains.
- Day trading inside a TFSA can be taxed. The CRA may treat frequent trading as business income. Buy-and-hold investors need not worry.
Sources: CRA — Tax-Free Savings Account; Wealthsimple — TFSA rules 2026; Desjardins — TFSA 2026.