Contributions to “Children’s” Tax Free Savings Accounts
We have something else to share with you regarding TFSA’s that has to do with parents funding their children’s accounts.
We have something else to share with you regarding TFSA's that has to do with parents funding their children's accounts. Some parents are contributing to the TFSA's of their children (who must be 18 or older to have a TFSA). The Canada Revenue Agency has made it clear that the funds must come from the person who holds the TFSA. If you would like to fund your "child's" TFSA contribution, be sure to gift him or her the funds so that they can be transferred from his or her own bank account to the TFSA. We know that this seems like an unnecessary extra step but it is important to follow the rules so that you can be certain that the TFSA will continue to be considered valid by CRA . If it is no longer considered valid then all of the income earned in the account will be considered taxable.