The Tax-Free Financial savings Account (TFSA) in Canada is an environment friendly method to create tax-exempt passive revenue. A TFSA person can unlock the account’s full potential if the necessity is pressing. Nonetheless, it will require a extra aggressive, “high-yield” technique to attain 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:FRU) is a perfect passive power play minus the drillers’ danger. 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 price changes. As of January 28, 2026, the benchmark price is right 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 dwelling and industrial short-term bridge and standard actual property financing. Different lending actions embrace building financing, mezzanine debt, and fairness investments. As a mortgage funding company (MIC), Agency Capital doesn’t pay revenue taxes; it allocates 100% of internet revenue for dividend funds.
Agency Capital’s diversified mortgage portfolio contains principally first mortgages. That can also be why traders have been having fun with steady returns and constant revenue streams for years. Apart from not lacking paying common month-to-month dividends since 2013, the MIC has declared particular year-end dividends yearly.
Stable anchor tenant and growth 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 grow to be the enormous American retailer’s solely actual property growth accomplice.
Walmart stays SmartCentres’s anchor tenant in 114 buying 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 price 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 progress, together with anchors.
SmartCentres’s growth pipeline continues to develop. The self-storage services, 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 supply is 6.8%.
Decrease-risk choice
Freehold Royalties is a lower-risk choice within the extremely unstable power sector. The $2.7 billion firm will not be an business operator. As a substitute, it boasts a royalty-based enterprise mannequin. The royalties it collects from 380 oil drillers fund dividend funds. For those who make investments right this moment ($16.56 per share), the dividend yield is 6.52%.
Based on administration, Freehold’s diversified, oil-focused portfolio and investment-grade operators in Canada and the U.S. present money circulation stability. The royalty firm doesn’t fear about capital, working, and abandonment prices as a result of there are none.
Tax-free gush
The typical 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 circulation in a TFSA could be $81.43, or $977.20 yearly. The tax-free “gush” may tackle your pressing monetary want.
