Can I keep my TFSA if I go Bankrupt?

Can I keep my TFSA if I go Bankrupt

Table of Contents

 TFSA and Bankruptcy

This is a great question and when this question arises, it brings a comparison between TFSA and RRSPs as both are options you may consider for saving. If you happen to be declaring bankruptcy, you will need to disclose all of your assets to the trustee and these include your RRSPs, TFSAs and so on.

Tax free savings accounts have no protection in bankruptcy. Contributions made in the 12 months before filing, may not be protected with RRSPs, but the balance contributed more than 12 months before filing are protected.

With a personal bankruptcy

If you are declaring personal bankruptcy, only certain assets are allowed to be exempted (via the Ontario Execution Act) and this depends on the nature of the assets. The Ontario Execution Act provides an exemption for one vehicle to the extent of $6,600, personal effects (clothing) now has no limit, household items (furniture) to the extent of $13,150 and tools of trade to the extent of $11,300.

When the non-exempt assets have been dispersed to your creditors, and all the circumstances of the bankruptcy are met, you are then legally released from those debts owed to the unsecured creditors. Other issues can come into play such as surplus income for example.

Depending on whether it is your first, second or third time filing for bankruptcy, it can take from 9 months to 36 months to complete and will be on your credit record for 7 years once your bankruptcy has been completed.

When you meet with your Licensed Insolvency Trustee, they will review all your options, and bankruptcy may not be the best choice for you. A consumer proposal could be another option.

With a consumer proposals

With a consumer proposal, if you happen to owe $250,000 or less (mortgage not included), you may qualify for a consumer proposal. With a consumer proposal, you get to keep your assets which includes your TFSA by providing monthly payments in a proposal.

With a consumer proposal, you pay a portion of your unsecured debt over a period of 5 years or less.

Whether you have a TFSA or an RRSP, you should get all the facts with a free consultation at the offices of David Sklar & Associates. There are more options available than just Bankruptcy, and we can help you determine what the best option for you is.

Consumer Proposals with David Sklar & Associates

The unfortunate reality is that many Ontario residents have been thrown into financial instability because of the current health crisis and are now concerned about what to do next. If you need financial help, the licensed insolvency trustees at David Sklar & Associates are here for you. 

We offer over-the-phone consultations and electronic document signing so that you can access our services from the safety of your home. We want to encourage our clients to prioritize their health as best as they can during these uncertain times.

Patience can be rewarding. If you wait to apply for credit after you complete your consumer proposal and rebuild your credit score, you’re going to get better options from lenders. Contact us today so we can walk you through your options. 

Take Your First Step Towards A Debt Free Life

If you are overwhelmed by debt, call us at 1-844-962-9200 to book a FREE, confidential appointment. We will review your financial situation in detail and discuss all of your options with you. Alternatively, you can fill out the form below and our team will reach out to you. 

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Great experience i was in financial trouble and someone of my friends recommended this company. Cori is a wonderful and welcoming person she did a very good job and came up with a smooth and flexible monthly payment after the reduction. i highly recommend this company. Thank you David sklar and special thanks to Cori.❤️🙏🏻
Jasmine Joseph
22:08 13 Jan 23
Met up with Mr. Jason Sklar to discuss more in person, very thorough and clear. He is very kind and thoughtful, I will be referring anyone with the same situation to David Sklar & Associates.
Ariel Domingo
02:33 29 Dec 22
I was a reck talking yo Jason Sklar was easy comfortable he explained everything and put my mind at ease I would recommend the team od sklar to everyone. I have already talked to my ci workers about them
kevin mcweeney
01:13 22 Dec 22
The team at David Sklar & Associates is fantastic.I worked with Jerry whom not only made - what seemed like intimidating process to initiate at first - comfortable.He made everything transparent and took the time to explain the process every step of the way.He was kind, attentive, and professional. Everything was made straightforward and stress free and we found a solution together that worked.Thanks to Jerry and the team.
Jordie Angiolillo
18:22 21 Dec 22
From day one till the end which is today😁 DavidSklar gave me a 5star service and treatment. And I will 100% recommend him and his Associates. This is the best Christmas present ever! Thank you David! More business to come! Merry Christmas and a Happy New Year!!!
barbee diaz
16:37 16 Dec 22
I FOUND DAVID SKLAR & ASSOCIATES BY GOOGLING "BANKRUPTCY" (EARLY NOV. 2021). ON NOV.4, 2021 I HAD A MEETING WITH CORI NARON AT HER OFFICE AT ST CLAIR ANDBATHURST. HER POSITIVE APPROACH TURNED ASTRESSFUL SITUATION INTO A STEP BY STEP UNDERSTANDABLE PROCESSON SEPT. 23, 2022 I OBTAINED MY AUTOMATICDISCHARGE FROM BANKRUPTCY AND MY CERTIFICATE OFDISCHARGE.THANK YOU CORIBRUCE BURGESS
bruce burg
21:35 02 Dec 22
Jerry was wonderful and provided superb service. He is very knowledgeable, trustworthy, and made an intimidating and shame filled time in my life stress free. I hesitated for a long time to take the next step, but Jerry answered all questions, was patient and made the process effortless. I am eternally grateful, and highly recommend Jerry’s services.
M J
18:41 01 Dec 22
Jerry was professional and was easy to deal with
Debbie Asquith
00:09 29 Nov 22
I was quite nervous and a little embarrassed that I needed financial advice. I met with Jerry Janiec and he was very helpful. He made me feel comfortable and explained everything in easy to understand terms so that I understood what my options were. I would recommend David Sklar & Associates for anyone in my position.
Melissa Blackburn
19:53 17 Nov 22
I was fortunate enough to be referred to David Sklar & Associates Inc. by a family member. Now in the10th month of a Consumer Proposal process, I am very impressed with the organization, professionalism and impeccable customer representation that I have experienced. To this effect, I amparticularly thankful to Jerry Janiec and Rhoda Lewis for their excellent work.
Suzanna Vaclavik
12:21 16 Nov 22
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