Characteristics of the TFSA and the RRSP

reer vs celi
Discover the main characteristics of each solution
Savings Goal Accumulate tax-free savings to carry out projects throughout your lifetime. Accumulate tax-deferred savings for retirement while lowering your taxable income at the time of contribution.
Contribution Deadline You can contribute to a TFSA so long as you have not exceeded the contribution limit. During the first 60 days of the following year
Minimum Age  18 years old  No minimum age but you must be over 18 years old to deposit more than $2,000.
Maximum Age   None You must convert your RRSP into a Registered Retirement Income Fund (RRIF) no later than December 31 of the year you turn 71. 
Income Required  None  Employment, business or excess net rental income is required to accumulate contribution room.
Annual Contribution Limit $6,000 in 2022
The annual TFSA contribution limit does not depend on income. It is the same for all Canadians.

18% of income earned in the preceding year to a maximum of $27,830 (for 2021). The maximum contribution established by the Canada Revenue Agency, as well as income, determine the annual contribution limit.

Contribution Room Contribution room has been cumulative since the TFSA was created in 2009 and stands at $81,500 in 2022. Contribution room is cumulative and corresponds to deductions not used in previous years, starting from 1991.
Deductions Contributions are not deductible from taxable income. Contributions are deductible from taxable income.
Withdrawals Not taxable 
You can withdraw money from your TFSA at any time without being taxed. In addition, the amount withdrawn is added to your limit for the following year.
You must pay tax if you withdraw money from your RRSP. The amount withdrawn is not added to the limit for the following year./td>
Investment Income Not taxable  Tax-deferred
Impact of Withdrawals on Government Benefits or Tax Credits

Withdrawals are not considered taxable income.

Involves a decrease or a loss.
Withdrawals are considered taxable income.

Over-contribution Subject to a penalty tax of 1% a month on the excess amount until it is withdrawn from the TFSA. Subject to a penalty tax of 1% a month on the excess amount until it is withdrawn from the RRSP.
A lifetime over-contribution totalling $2,000 is allowed without penalty.
Contribution to a Spousal Account

There is no such thing as a spousal TFSA.
Even so, the income allocation rules of the Canada Revenue Agency do not apply when you give money to your spouse for a contribution to his or her own TFSA.

Possible and involves a deduction for the contributor.
The amounts paid into a spousal RRSP cannot exceed the contributor’s personal contribution limit.
Taxation at Death The surviving spouse can add the amounts accumulated by the deceased to his or her own TFSA by tax rollover6 without affecting his or her contribution room. From the time of death and until the rollover, the returns are taxable for the estate. Taxable at death unless the RRSP is transferred to the spouse or to minor children on certain conditions.

*It is necessary to complete Form RC240, and the beneficiary spouse must be designated in the will. 

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