The taxman and your TFSA

“When you’ve been hanging around the financial services world as long as I have, you inevitably come to understand the many ways that people can make money. Some stories are as improbable as, say, an adult accidentally swallowing a toothbrush (it’s rare but it happens; just ask British student Georgie Smith, now 21, who, to the best of my knowledge, is the latest person to do this). Take, for example, the improbability that your tax-free savings account (TFSA) today might be worth many hundreds of thousands of dollars – perhaps even millions. The fact is, there are more Canadians in this boat than you might think. And the Canada Revenue Agency (CRA) isn’t happy about it.” writes Tim Cestnick for The Globe and Mail. Cestnick continued, “In my recent discussions with the CRA, it’s clear that rumours of a tax-audit project focusing on TFSAs are true. The CRA seems to be focusing on TFSAs that have a very significant value. And perhaps this should be no surprise, because those dollars will one day be withdrawn tax-free. It’s not clear what dollar value in a TFSA might create a red flag for the taxman”. Read the full article here. Raymond Matt, CFP, CLU, TEP, CHS

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