Ottawa hikes limit on tax-free savings accounts to $5,500
Canadian currency is seen in this file photo. (CTV)
Published Monday, November 26, 2012 7:41AM PST
OTTAWA - Ottawa says Canadians will be able to be able to contribute an additional $500 a year on their Tax Free Savings Accounts starting Jan. 1.
That means Canadians can put in $5,500 a year, with any investment income earned not subject to taxation while it remains in the TFSA.
When the TFSAs were created in 2009, the government said it would index the contribution limit to inflation in $500 increments.
The Jan. 1 increase will be the first adjustment in the contribution limit.
The government says about 8.2 million Canadians have opened a tax-free account.
It says 2.5 million Canadians contributed the maximum $5,000 amount last year.