Project your Tax-Free Savings Account growth with the R46,000 annual and R500,000 lifetime limits.
Last reviewed: 6 September 2026 · SARS 2026/2027 tax year
R46,000 / Year LimitR500,000 Lifetime100% Tax-Free GrowthYear-by-Year Milestones
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TFSA Growth Calculator
Tax-Free Savings Account — South Africa
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TFSA Projection
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Frequently Asked Questions — TFSA South Africa
The annual contribution limit is R46,000 per tax year. Contributions above R46,000 in a single year attract a 40% penalty tax levied by SARS. This limit applies per individual across all their TFSA accounts combined.
The lifetime contribution limit is R500,000. Once you have contributed R500,000 in total across all years, you cannot contribute further. Returns and growth above R500,000 are allowed and remain completely tax-free.
All returns within a TFSA — interest, dividends and capital gains — are completely tax-free. You pay no income tax on interest, no dividends tax (20%), and no capital gains tax on growth within the account. This makes TFSAs especially powerful for long-term compounding.
Yes, you can withdraw at any time without penalty. However, withdrawals do NOT restore your contribution room — the amount withdrawn still counts toward your R500,000 lifetime limit permanently. For this reason, avoid withdrawing from your TFSA unless absolutely necessary.
You can hold: bank savings accounts, fixed deposits, unit trusts, ETFs, and JSE-listed shares in a TFSA. You cannot hold: property, foreign shares directly (you can use ETFs), or any instrument not approved by SARS. Platforms like EasyEquities, 10X, and Allan Gray offer TFSA products.
Yes — unlike a retirement annuity, you can withdraw from a TFSA at any time and for any reason. However, the critical rule is that withdrawals do not restore your contribution room. If you withdraw R20,000, you cannot re-contribute that R20,000 in the same year — it counts permanently toward your R500,000 lifetime limit. Plan withdrawals carefully to avoid unnecessarily using your limited contribution room.
Contributions above R46,000 in a tax year attract a 40% penalty tax on the excess amount, charged by SARS. For example, contributing R50,000 in a year means R4,000 in excess — resulting in a R1,600 penalty. SARS tracks this automatically. If you have multiple TFSA products at different providers, the combined contribution across all of them must not exceed R46,000/year.
Yes — completely. Inside a TFSA, there is no income tax on interest earned, no dividends tax on dividend income, and no capital gains tax when you sell assets at a profit. This is a significant advantage over taxable accounts, where interest is taxed at your marginal rate (up to 45%), dividends at 20%, and capital gains at up to 18% effective rate. Over decades, this tax-free compounding creates a substantial wealth advantage.
South African Tax-Free Savings Accounts: Rules, Limits and Strategy
A Tax-Free Savings Account (TFSA) allows South Africans to invest and grow wealth completely free of income tax, capital gains tax, and dividends tax. Introduced in March 2015, TFSAs are among the most powerful personal finance tools available to South African investors. Every rand of growth stays in your pocket.
TFSA Contribution Limits (2026/2027)
Limit Type
Amount
Penalty if Exceeded
Annual contribution limit
R46,000 per tax year
40% tax on excess
Lifetime contribution limit
R500,000 total
40% tax on excess
Withdrawals
Anytime, no tax
Do NOT restore contribution room
Important: Contributions are tracked across ALL TFSA products at all providers. If you hold a TFSA at three banks, your combined annual contribution must not exceed R46,000.
What Products Qualify as a TFSA?
Tax-free unit trusts and ETFs (e.g. Satrix, 10X, Coronation, Allan Gray, Old Mutual)
Tax-free fixed deposits (offered by major SA banks)
Because no tax is deducted on dividends, interest or capital gains, your TFSA grows faster than a comparable taxable account. Contributing R3,833/month from age 25 at a 10% annual return would reach the R500,000 lifetime limit in approximately 11 years — but by retirement at 65, that investment could be worth over R15 million, all completely tax-free. The R500,000 lifetime limit of contributions would have generated over R14.5 million in untaxed growth.
Best Strategy: Max TFSA First, Then RA
Most financial planners recommend: first maximise your TFSA (R46,000/year) for its complete flexibility and tax-free withdrawal, then direct remaining savings into a retirement annuity (for the tax deduction on contributions). This gives you both liquidity and long-term tax efficiency.