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Income Tax Act s. 207.01
Tax-Free Savings Account Investments
Qualified Investments
Qualified investments are permitted to be held in a TFSA. Qualified investments generally include all RRSP qualified investments, as long as these are arm's-length investments.
Non-Qualified and Prohibited Investments
Non-qualified and prohibited investments may not be held in an FHSA, TFSA, RRSP, RRIF, RESP, or RDSP:
 | Non-qualified investments include, for example, land and general partnership units. | ||||
|
Prohibited investments are specifically identified
in the Income Tax Act, and include property that
is
ii. a person or partnership that does not deal at arm's length with the holder, or with a person or partnership described in (i) |
When prohibited or non-qualified investments are held in a TFSA, taxes will apply. Non-qualified and prohibited investments are tax differently. See taxes payable re TFSA (link below).
Canada Revenue Agency (CRA) Resources
Income Tax Folio S3-F10-C1, Qualified Investments - RRSPs, RESPs, RRIFs, RDSPs and TFSAs
Income Tax Folio S3-F10-C2, Prohibited Investments - RRSPs, RRIFs and TFSAs
Tax Tip: Don't hold non-qualified or prohibited investments in your TFSA.
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Revised: October 26, 2023