The MD Tax Free Savings Account (the MD TFSA) lets you save up to $5,500* per year (indexed to inflation and rounded to the closest $500, starting in 2017) without paying tax on investment earnings. It’s also important to remember that a TFSA is an investment account, and who better to help you understand your investment options than your MD Advisor?
The MD TFSA offers benefits for all investors:
- income grows tax-free
- you have the same investment options as with a registered retirement savings plan (RRSP)—including stocks, exchange-traded funds and fixed-income MD mutual funds
- unused contribution room carries forward
- withdrawals can be made any time
- withdrawals can be replaced (i.e., amounts withdrawn are added to your contribution room for the next calendar year)
- withdrawals don’t affect federal income-tested benefits or credits
Your MD Advisor will provide the advice you need, no matter what stage you're at:
Open an MD TFSA and start saving
Your MD Advisor will take care of opening your MD TFSA. Contact your MD Advisor to book an appointment, or indicate your interest in having the application sent to you. Your Advisor will also provide the advice that will help you get the most out of your MD TFSA.
Make it easy to contribute
Work with your MD Advisor to fit regular contributions into your budget so that you maximize your annual contribution.
Weigh your options
Which is better, opening a TFSA or paying down debt? What about RRSPs? Your MD Advisor can help you examine your overall financial picture and use the MD TFSA in a way that’s best for you.
Think like an investor
A TFSA is an investment account, not a bank account. Decisions you make will affect how quickly your TFSA investments grow. Your MD Advisor can provide the objective advice and portfolio strategy you need to reach your investment goals.
How an MD TFSA fits with your other investments
Your MD Advisor can provide the advice you need to fit this investment vehicle into your portfolio in a tax-efficient way.
Evaluate your options
Do you open a TFSA instead of contributing to an RRSP or RESP? Do you move money into a TFSA from an existing non-registered account? Your MD Advisor will help you look at your overall portfolio and suggest where an MD TFSA fits, ensuring it is consistent with your risk tolerance and overall financial goals and objectives.
Balance your assets
Where you hold fixed income and equities is crucial to a tax-efficient portfolio. Your MD Advisor will help you take advantage of an MD TFSA while maintaining an optimal asset location.
Make an MD TFSA part of your retirement plan
The MD TFSA provides a way to invest excess RRIF and pension payments and have them grow tax-free. Your MD Advisor will work with you to determine the best allocation of excess funds and build a pre-authorized contribution plan.
Contact your MD Advisor today to book an appointment or to have an application mailed to you.
MD TFSA options for incorporated physicians
A corporation is not eligible to open a TFSA, but your MD Advisor can provide the advice you need to personally take advantage of an MD TFSA, in a tax-efficient way.
Proceed with caution
If you’re in the top marginal tax bracket, you may take a tax hit if you draw fully taxable income from your corporation to personally invest in a TFSA. Your MD Advisor will help you examine your specific situation to identify what will work best for you.
Take a team approach
A TFSA has no attribution rules, meaning you can give your spouse or common-law partner money to contribute to their own TFSA. Your MD Advisor can provide advice on how to use dividend payments or other income to fund your MD TFSAs.
Work the TFSA account to your advantage
Your MD Advisor can explain the cases where you can draw funds without tax implications from your corporation (for example, using a positive balance in your capital dividend account). Your MD Advisor can then help you invest these funds in an MD TFSA in a way that complements your corporate investments.