Who is eligible to contribute to a Tax-Free Savings Account (TFSA)?

Who is eligible to contribute to a Tax-Free Savings Account (TFSA)?

• A. Canadian citizens under 65.
• B. Canadian residents age 18 or older.
• C. Non-residents over age 18.
• D. Non-residents over age 71.

Answer: (B)

The eligibility to contribute to a Tax-Free Savings Account (TFSA) is determined by residency and age. Specifically, any individual who is a Canadian resident and at least 18 years old can open and contribute to a TFSA, regardless of their age thereafter. This means that as long as a person maintains their status as a Canadian resident and has reached the minimum age requirement, they can contribute to a TFSA, which allows their investments to grow tax-free. This is significant because the TFSA is designed to encourage savings among Canadians, and the rules ensure that a broad base of the population has access to this savings vehicle. Being a Canadian resident is crucial; it means individuals must be living in Canada for tax purposes to qualify for TFSA contributions. The other options presented in the question do not fully encompass the residency requirement or include age restrictions that do not apply to TFSA eligibility.

The eligibility to contribute to a Tax-Free Savings Account (TFSA) is determined by residency and age. Specifically, any individual who is a Canadian resident and at least 18 years old can open and contribute to a TFSA, regardless of their age thereafter. This means that as long as a person maintains their status as a Canadian resident and has reached the minimum age requirement, they can contribute to a TFSA, which allows their investments to grow tax-free.

This is significant because the TFSA is designed to encourage savings among Canadians, and the rules ensure that a broad base of the population has access to this savings vehicle. Being a Canadian resident is crucial; it means individuals must be living in Canada for tax purposes to qualify for TFSA contributions. The other options presented in the question do not fully encompass the residency requirement or include age restrictions that do not apply to TFSA eligibility.