Desjardins Credit Union [Change site]
Compare TFSAs and RRSPs
TFSAs and RRSPs are very profitable registered savings plans that allow you to save money tax-free.
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TFSAs:
Save for a specific goal
A TFSA is a registered savings plan that allows you to put money aside tax-free to reach short-term goals throughout your life. It is useful for:
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RRSPs:
Save for retirement
An RRSP is a registered savings plan that allows you to build tax-free retirement savings while also reducing your tax load at the time of contribution. It is useful for:
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There may, however, be exceptions to these rules. For example:
- TFSAs may be better than RRSPs to save for retirement.
- Borrowing from your RRSP to buy a home through the Home Buyer's Plan is often a very effective strategy.
- A TFSA may also be useful when you have contributed the maximum to your RRSP and are seeking an additional tax deduction.
Determining which plan is better for you can be complex. Discuss it with your Desjardins advisor.
TFSA and RRSP comparison chart
TFSA |
RRSP |
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Contribution deadline
| January 1 to December 31 of current year |
February 29, 2012 |
Age limit
| None |
The year of your 71st birthday |
Contribution amount
| Up to $5,000 per year since 2009 for everyone |
18% of income earned the preceding year, up to $22,450 in 2011 and $22,970 in 2012 |
Are contributions income tax deductible?
| No |
Yes |
Withdrawals
| Non-taxable |
Taxable |
Investment income
| Non-taxable |
Non-taxable |
Unused contribution room
| The unused portion of your maximum allowable contributions since 2009 |
The unused portion of your maximum annual amount deductible since 1991 |
Excess contributions
| Not allowed |
Up to $2,000 above the maximum allowable annual contribution |
Impact of withdrawals on benefits from social programs
| None |
Added to taxable income. |
Do withdrawals increase contribution room?
| Yes, equal to the qualifying amount withdrawn1 and added to the contribution room for the following year. |
No |
Are spousal contributions allowed?
| No. However, money you give your spouse to contribute to a TFSA is not subject to attribution rules. |
Yes. The contributing spouse claims the tax deduction even if he or she not the beneficiary. |
Taxable upon death?
| No. Amounts generated prior to death can be rolled over to the spouse tax-free. |
Yes, except if rolled over to spouse, or to minor or disabled child. |
Can it be used as collateral for a loan?
| Yes |
No |
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TFSA- and RRSP-eligible investments
Choose from our wide range of savings products to invest in your TFSA and RRSP plans.
Type of investments |
TFSA |
RRSP |
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 By phone |
Montreal area: 514-CAISSES (514-224-7737) Elsewhere in Canada and the U.S.: 1-800-CAISSES (1-800-224-7737) |
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 At the branch
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Make an appointment with an advisor at a branch.
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1. Following changes recommended by Finance Canada, withdrawals of overcontributions, non-qualified investments and amounts attributable to swap transactions, or of any related investment income, do not create additional TFSA contribution room. Some of this income will be taxed at 100%.
