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Tax-free growth for your clients’ savingsTax-Free Savings Accounts from Manulife Bank
Name, DESIGNATIONTitle, Company Name
Date
The need for tax-free savings accounts
Additional tax-sheltered savings
Good for short-term and long-term savings
Part of overall financial plan
What is a Tax-Free Savings Account (TFSA)?
Flexible savings account
Available for Canadian residents 18 years or older
Tax-free growth on savings
Contribution room tracked by Canadian Revenue Agency (CRA)
Contributing to a TFSA
Annual contribution limit provided by Canada Revenue Agency (CRA)
Unused contribution room will carry forward
No tax deduction for contributions
Withdrawing from a TFSA
All withdrawals and income earned are tax-free
Income earned and withdrawn does not affect income-tested benefits and credits
Withdrawals are added back to the available contribution room in the next calendar year
No restrictions on how withdrawals are used
Penalties will be charged for: Contributions over limits
Non-resident contributions
Non-qualified investments
Investment planning with a TFSA
No restriction on the number of TFSA accounts held per person, as long as combined contributions do not exceed limits
Fees are not tax deductible
Direct transfers between TFSAs of one account holder do not affect contribution room
Possible uses for a tax-free savings account
First portion of any non-registered assets/bank accounts
Emergency funds
Saving for mid-size purchases
Instead of RRSP for low-income earners
In addition to RRSP for high-income earners
Excess RRIF income
RRSP refunds
Manulife Bank has three TFSAs for your clients
Tax-Free Advantage Account A high-interest bank account
Tax-Free GIC (1 to 5-year) Long-term interest-bearing investment
Investment Savings Account Investment Savings Account is TFSA-eligible if your dealer has a
Tax-Free plan
Product details – Tax-Free Advantage Account
Product Summary High-interest, fully liquid Tax-Free Savings Account
Availability Client name (off-book)
Minimum Deposit None
Interest Structure Variable rate. Full rate paid on every dollar. No tiers
Liquidity Fully liquid -- no penalty for withdrawal
Deposit Options Deposit cheque by mail, local deposit via advisor, funds transfer
Deposit Fees None
Withdrawal Options and Fees
Official Cheque, transfer to another bank account, transfer to other TFSA account of same account holder -- no withdrawal fees
Statements Quarterly
The variable annual interest rate is applied to all funds in the account. Interest is calculated daily on the total closing balance and paid monthly. Rate is subject to change.
Product details – Tax-Free GIC
Product Summary Long-term interest-bearing investment
Availability Client name (off-book)
Minimum Deposit $2,500
Interest Structure Annual compound interest paid at maturity
Liquidity Can be redeemed prior to maturity, subject to market value adjustment and expense recovery fees
Deposit Options Cheque, local deposit via advisor
Deposit Fees None
Withdrawal Options and Fees
No fees at maturity. Can be redeemed prior to maturity, subject to market value adjustment and expense recovery fees
Statements Deposit confirmation and renewal notice
Interest is forfeited if a Short Term Deposit is redeemed before 30 days. If redeemed on or after 30 days but prior to maturity the interest rate is prorated (rate discount of 1.25%). In addition there is a $25.00 administration fee charged for early redemptions.
How to apply
One application for both Tax-Free Advantage Account and Tax-Free GIC (AB0490E).
Application includes instruction sheet for completing and submitting it and what documentation you need from the client.
Application and all product information can be found in the Banking section of Repsource – Manulife’s advisor website – at manulife.ca/repsource.
For more information, contact your Business Development Director at 1-800-567-9170.
Important notes
Tax-Free Advantage Account, Tax-Free GIC and Investment Savings Account are offered through Manulife Bank of Canada.
Manulife, Manulife Bank, the Manulife Bank For Your Future logo, the Block Design, the Four Cubes Design, and Strong Reliable Trustworthy Forward-thinking, are trademarks of The Manufacturers Life Insurance Company and are used by it, and by its affiliates under license.
Questions?
Thank you