Understanding who is eligible to open a Tax-Free Savings Account and when personal contribution limits begin to accrue is critical to effective financial planning for Calgary residents. This financial tool is available to a wide range of people, but there are specific requirements and nuances that every potential account holder should be aware of.
Basic criteria for eligibility to open a TFSA
Canadian law establishes three basic conditions that a person must meet in order to be eligible to open a TFSA. First, you must be a resident of Canada for tax purposes. Second, you must have a valid Social Insurance Number (SIN). Third, the person must be at least 18 years of age, although in some provinces and territories this requirement varies slightly.
It is important to note that the residency criterion is based on tax status, not citizenship or immigration status. This means that Canadian citizens, permanent residents, and certain categories of temporary residents — in particular, holders of valid work permits and study permits — can open a TFSA provided they meet the definition of a Canadian resident.
Residency for tax purposes is determined by the existence of significant ties to Canada. Such ties include: residence in the country, the presence of a spouse or dependents in Canada, the presence of personal property (cars, furniture), bank accounts, provincial or territorial health insurance coverage, a Canadian driver's license, membership in professional organizations, and other socio-economic ties to the country.
Age requirements and features in different provinces
Federal law sets the minimum age for opening a TFSA at 18. However, there are provinces and territories in Canada where the legal age of majority, i.e., the age at which a person can enter into legal agreements and contracts, is 19.
In Alberta, where Calgary is located, the age of majority is 18. This means that Calgary residents can open a TFSA immediately upon reaching the age of 18 without any additional restrictions or waiting periods. They can go to any financial institution—a bank, credit union, or investment company—provide the necessary documents (ID and SIN number), and sign the appropriate account opening agreement.
In provinces and territories where the age of majority is set at 19 (e.g., British Columbia, Nova Scotia, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nunavut, and Yukon), young people find themselves in a specific situation. They begin to accumulate contribution room from the year they turn 18, but cannot actually open an account and make contributions until they turn 19. The amount of room accumulated during that year is carried forward to the following year and becomes available for use once they reach the age of majority under provincial law.
For Calgary residents, this means a straightforward and understandable system: on or after their 18th birthday, they can immediately open a TFSA and make contributions within the limit available at that time.
When does the right to contribute begin to accrue?
The right to contribute to a TFSA begins to accrue automatically from the year a person turns 18, even if they do not open an account, file a tax return, or even know about the existence of this financial instrument.
The TFSA program was introduced by the Canadian government in 2009. For those who were residents of Canada and were 18 years of age or older in 2009, contribution room began accruing in that year. This means that as of 2025, a person born in 1991 or earlier and who has been a permanent resident of Canada since 2009 has a total accumulated contribution room of $102,000—even if they have never opened a TFSA or contributed a single penny.
For those born later, contribution room begins to accrue from the year they turn 18. For example, if a person was born in 2005, they turned 18 in 2023. From that point on, their contribution room began to accumulate: $6,500 for 2023, $7,000 for 2024, and $7,000 for 2025 — a total of $20,500.
It is critical to understand that contribution room is automatically generated for every Canadian resident of the appropriate age, regardless of income level, employment status, marital status, or any other factors. This fundamentally distinguishes the TFSA from the RRSP (Registered Retirement Savings Plan), where the contribution limit is directly dependent on earned income from the previous year.
Features for new immigrants and new residents of Calgary
For people who have recently moved to Canada and settled in Calgary, the TFSA contribution accumulation system works a little differently. New immigrants who have obtained permanent resident status or become Canadian citizens can open a TFSA immediately after receiving their social insurance number and reaching the age of 18.
The key point is that contribution room for newcomers only begins to accumulate from the year they become tax residents of Canada and receive a valid SIN. Unlike those who were born in Canada or have lived here since 2009, immigrants are not eligible for the accumulated limit for previous years when they were not yet residents of the country.
Let's say a person became a permanent resident of Canada and received a SIN in 2023, but only opened a TFSA in 2025. In this case, their total contribution allowance would be: $6,500 (for 2023) + $7,000 (for 2024) + $7,000 (for 2025) = $20,500. Even though the account was only opened in 2025, the unused limits for 2023 and 2024 are automatically carried over and remain available for contribution.
This system is extremely beneficial for newcomers to Calgary, as it allows them to immediately start building tax-efficient savings and investments without having to wait or complete complex administrative procedures. All you need is three things: resident status, a SIN number, and to be 18 years of age or older.
Temporary residents: work and study permits
A separate category is made up of temporary residents of Canada — individuals who are in the country on work permits or study permits. Formally, the law allows them to open a TFSA provided they have a valid SIN and are at least 18 years of age.
However, there is an important restriction for temporary permit holders: the right to make contributions accrues only for those years during which they were recognized as tax residents of Canada. If a person with a work permit has lived in Canada for a full calendar year and has sufficient ties to the country to be considered a resident for tax purposes, they will receive the full annual contribution limit for that year.
At the same time, potential risks must be taken into account. If a work or study permit holder leaves Canada after the permit expires and becomes a non-resident, any contributions made while they are a non-resident will be subject to a penalty tax of 1% per month of the contribution amount for as long as the funds remain in the account or until the person regains resident status.
Students and temporary workers in Calgary are advised to carefully assess their resident status and future plans before opening a TFSA. If you are confident about staying in Canada for the long term and have stable ties to the country, a TFSA can be an excellent tool for saving money. If you are planning a short-term stay with a subsequent return to your home country, you may want to consider other savings options.
Annual contribution limits: historical trends
To fully understand what contribution rights accrue each year, it is helpful to know the history of changes in annual limits since the TFSA program was introduced. The Canadian government sets these limits taking inflation into account, rounding them to the nearest $500.
Here is a complete chronology of annual limits from 2009 to 2025: from 2009 to 2012, the annual limit was $5,000; in 2013 and 2014, it increased to $5,500; in 2015, there was a jump to $10,000, but this turned out to be temporary; from 2016 to 2018, the limit returned to $5,500; from 2019 to 2022, it rose to $6,000; In 2023, it reached $6,500; and in 2024 and 2025, it is $7,000.
The total maximum possible limit for a person who has been a resident of Canada aged 18+ since 2009 is $102,000 as of 2025. This amount is the result of adding all annual limits for the 17 years of the program's existence.
For a younger person who turned 18 in 2018, for example, the accumulated limit as of 2025 will be: $5,500 (2018) + $6,000 (2019) + $6,000 (2020) + $6,000 (2021) + $6,000 (2022) + $6,500 (2023) + $7,000 (2024) + $7,000 (2025) = $50,000.
How to check your personal contribution room
The Canada Revenue Agency (CRA) keeps track of all TFSA contributions and withdrawals for every resident who has a SIN. This information is updated annually and becomes available a few months after the end of the tax year, usually by the end of February or early March of the following year.
The easiest way to find out your current contribution room is to log in to the “My Account for Individuals” online service on the CRA's official website. In the TFSA section, you can see detailed information about all contributions made in previous years, withdrawals, and your current available limit. Alternatively, you can download the MyCRA mobile app or call the Tax Information Phone Service (TIPS) at 1-800-267-6999.
It is important to remember that the data in the CRA system is updated with a delay. If contributions were made during the current calendar year, they will not appear in the online system until the beginning of the following year. Therefore, TFSA holders need to keep track of their contributions throughout the year to avoid exceeding the limit and incurring related penalties.
Accrual of contribution room: an automatic process
One of the biggest advantages of a TFSA is that contribution room accrues automatically, without the need to file tax returns, register for special programs, or perform any administrative actions. Even if a person is not working, has no income, does not file tax returns, and knows nothing about TFSAs, their contribution room still grows each year as long as they meet the age and residency criteria.
This means that young Calgarians who are attending university, do not have a steady income, or are just starting their careers are already accumulating the right to future contributions. When they eventually earn a steady income and are able to save money, they will be able to contribute not only the current year's annual limit, but also all unused limits from previous years.
For example, a university graduate in Calgary who turned 18 in 2020 will be eligible for $37,500 in contributions by 2025, even if they never opened a TFSA and were unable to save while in school. When they find a job and start earning, they will be able to contribute a significant amount right away and start investing with tax advantages.
Impact of marital status and income
Unlike many other financial programs and tax benefits, the right to open a TFSA and accumulate contribution limits is completely independent of marital status, income level, employment, or any other socio-economic factors.
An unmarried student with no income has exactly the same right to contribute as a married professional with a six-figure annual income. A retiree, a parent of a large family, an entrepreneur, an unemployed person, a minimum wage earner—they all accumulate the same annual contribution limit set by the federal government.
This universality makes the TFSA an extremely democratic and accessible tool for all segments of Calgary's population. There is no income discrimination, as is the case with some tax breaks that gradually decrease for high-income earners. Every resident has equal opportunities to use this tool to build their financial future.
Non-residents: a special case
The situation with non-residents of Canada deserves separate consideration. Formally, the law does not prohibit non-residents who have a valid SIN and are 18 years of age or older from opening a TFSA. However, there are serious tax implications for them that make it financially disadvantageous.
Any contributions made by a person while they are a non-resident of Canada are subject to a penalty tax of 1% per month of the contribution amount until the funds remain in the account or until the person regains resident status. In addition, non-residents do not accumulate contribution room for the years during which they are not residents of Canada.
If a Calgary resident leaves Canada for an extended period and loses their resident status, they can keep their existing TFSA. Any income earned within the account (interest, dividends, capital gains) remains exempt from Canadian taxes. The person may also freely withdraw funds from the account without paying Canadian taxes. However, they will not be able to make new contributions without penalty and will not accumulate contribution room for the years of non-residency.
When a person returns to Canada and regains resident status, they begin to accumulate contribution room again. Amounts withdrawn from the TFSA while non-resident are added to the contribution room for the year following the return to resident status.
Practical tips for Calgary residents
For those who live in Calgary and are planning to open a TFSA or already have one, it is useful to keep a few practical points in mind. First, opening a TFSA is completely free at most financial institutions in the city. Major banks such as TD, RBC, Scotiabank, CIBC, and BMO, as well as local credit unions, offer a variety of TFSA options, from simple savings accounts to self-directed investment platforms.
Second, you don't have to open a TFSA as soon as you turn 18. Your contribution room continues to accumulate and can be used at any convenient time in the future. This is especially true for students and young people who don't yet have enough savings to contribute to the account.
Third, it is worth checking your contribution room regularly through the CRA's online services, especially before planning large contributions. This will help you avoid accidentally exceeding the limit and incurring penalties of 1% per month on the excess amount.
Fourth, new immigrants to Calgary should understand that their contribution eligibility is limited by their years of residency in Canada. There is no point in trying to claim the accumulated limit since 2009 if the person has only recently become a resident. At the same time, it is worth opening an account as soon as possible after receiving a SIN in order to start building tax-efficient savings.
Conclusion: accessibility and versatility of TFSA
The Tax-Free Savings Account is one of the most inclusive and accessible financial instruments offered by the Canadian tax system to residents of Calgary and across the country. The criteria for opening an account are as simple as possible: resident status, social insurance number, and being at least 18 years of age. The right to contribute is automatic and does not depend on income, employment, marital status, or any other factors.
For young Calgary residents, a TFSA opens up opportunities to start investing as soon as they reach the age of majority. For new immigrants, it is a chance to quickly integrate into the Canadian financial system and start building tax-advantaged savings. For experienced investors and entrepreneurs, a TFSA is a powerful tool for diversifying their portfolio and optimizing their tax burden.
Understanding when your contribution room begins to accumulate and how it grows over the years allows you to make informed financial decisions and take full advantage of the opportunities offered by this unique Canadian financial tool. Whether you were born in Canada or have just moved to Calgary, a TFSA can be an important part of your strategy for financial well-being and long-term prosperity in one of the country's most dynamic cities.