The Tax-Free Financial savings Account (TFSA) in Canada is an environment friendly strategy to create tax-exempt passive earnings. A TFSA person can unlock the account’s full potential if the necessity is pressing. Nonetheless, it might require a extra aggressive, “high-yield” technique to realize the specified outcomes.
Agency Capital Mortgage (TSX:FC) and SmartCentres (TSX:SRU.UN) are high picks in 2026 due to the anticipated low-rate surroundings. Freehold Royalties (TSX: MRS) is a perfect passive power play minus the drillers’ threat. Their beneficiant month-to-month dividends can flip a $14,000 TFSA right into a cash-gushing machine.
Common and particular year-end dividends
Agency Capital is a core pump in a TFSA money machine in 2026 after the Financial institution of Canada suspended charge changes. As of January 28, 2026, the benchmark charge is all the way down to 2.25% from 4.25% in September 2024. Along with the hefty 7.64% yield, the monetary inventory pays month-to-month dividends.
The $450 million non-bank lender gives residential house and industrial short-term bridge and standard actual property financing. Different lending actions embody development financing, mezzanine debt, and fairness investments. As a mortgage funding company (MIC), Agency Capital doesn’t pay earnings taxes; it allocates 100% of internet earnings for dividend funds.
Agency Capital’s diversified mortgage portfolio contains principally first mortgages. That can also be why buyers have been having fun with secure returns and constant earnings streams for years. Moreover not lacking paying common month-to-month dividends since 2013, the MIC has declared particular year-end dividends yearly.
Strong anchor tenant and improvement accomplice
SmartCentres owns and operates industrial, industrial, workplace, residential, and retail properties. The $4.6 billion actual property funding belief (REIT) facilitated Walmart’s entry into the Canadian market in 2024. It has turn out to be the enormous American retailer’s solely actual property improvement accomplice.
Walmart stays SmartCentres’s anchor tenant in 114 purchasing centres, contributing 23% of whole income. The portfolio consists of 197 income-producing properties. On the finish of the third quarter (Q3) of 2025, the occupancy charge was 98.6%, owing to sturdy leasing momentum. Notably, based on administration, about 84.3% of leases that matured in 2025 have been renewed and prolonged. The REIT additionally reported 6.2% year-over-year rental development, together with anchors.
SmartCentres’s improvement pipeline continues to develop. The self-storage amenities, two every in Quebec and British Columbia, will open in 2026 and 2027, respectively. At $17.19 per share, SRU.UN’s trailing one-year worth return is +17.4%. The present dividend provide is 6.8%.
Decrease-risk possibility
Freehold Royalties is a lower-risk possibility within the extremely unstable power sector. The $2.7 billion firm just isn’t an business operator. As a substitute, it boasts a royalty-based enterprise mannequin. The royalties it collects from 380 oil drillers fund dividend funds. In case you make investments at present ($16.56 per share), the dividend yield is 6.52%.
In response to administration, Freehold’s diversified, oil-focused portfolio and investment-grade operators in Canada and the U.S. present money move stability. The royalty firm doesn’t fear about capital, working, and abandonment prices as a result of there are none.
Tax-free gush
The common yield of the three dividend shares in focus is 6.98%. Assuming you allocate $4,666.67 price of shares every to Agency Capital, SmartCentres, and Freehold Royalties, the month-to-month money move in a TFSA can be $81.43, or $977.20 yearly. The tax-free “gush” may handle your pressing monetary want.