If a TFSA holds a non-qualified investment, or carries on a business, the TFSA trust is taxable on any income earned on and any capital gains derived from the non-qualified investments. You must report such income on Form T3RET, T3 Trust Income Tax and Information Return.
TFSA holders are liable for a 1% per month tax on their excess contributions and non-resident contributions. For more information, see Guide RC4466, Tax Free Savings Account (TFSA), Guide for Individuals.
- Non-qualified investments
What happens if the TFSA holds a non-qualified investment
- Tax on an advantage
Tax consequences to a TFSA issuer when an advantage is extended in relation to a TFSA
- Taxes on excess contributions and non-resident contributions
Tax implication on excess contributions and on contributions made by a non-resident
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