Scenario 67: Which type of registered plan allows contributions to be withdrawn tax-free, including any investment growth, provided certain conditions are met?

Question: Scenario 67: Which type of registered plan allows contributions to be withdrawn tax-free, including any investment growth, provided certain conditions are met?

Answer options:

• Registered Retirement Savings Plan (RRSP)
• Registered Education Savings Plan (RESP) ✅ Tax-Free Savings Account (TFSA)
• Registered Disability Savings Plan (RDSP)

Correct answer: Tax-Free Savings Account (TFSA)

Explanation: The Tax-Free Savings Account (TFSA) allows investment income, including capital gains and dividends, to grow tax-free and withdrawals to be made tax-free. RRSP withdrawals are taxable, and RESP withdrawals for educational purposes have a grant component (EAP) that is taxable to the student. The correct answer is "Tax-Free Savings Account (TFSA)". This capacity-fill scenario 67 reinforces the same competency for the ific bank and follows the certified explanation standard.