# Withdrawing from your TFSA

## How TFSA withdrawals work

Taking money out of your Tax-Free Savings Account is a two-stage journey, because your money is invested in funds rather than sitting as cash.

- **Sell to release cash**: You choose which holdings to sell and how much
- **Out to Cash first**: The proceeds land in your Fynbos Cash account, the same as every other Fynbos account
- **Then withdraw**: You withdraw from Cash to your linked bank account whenever you're ready

The button on your Tax-Free Savings account is labelled **Transfer out**, not "Withdraw", because the first stage moves money to your Cash account rather than to your bank.

> **Important**: Selling out of your TFSA permanently uses up your lifetime contribution allowance. You cannot re-contribute withdrawn amounts, even in future tax years, and the allowance is consumed at the moment you transfer out — not when the money later reaches your bank.

## Before you start

Two things need to be in place before Fynbos will process a TFSA transfer out:

- **Verified identity**: Your identity verification must be complete, because a TFSA withdrawal permanently consumes contribution room
- **Available holdings**: The units or shares you want to sell must be settled and not already reserved by another instruction

If either is missing, the app tells you which one on the screen where it applies.

## Transferring out of your TFSA

1. Navigate to your **Tax-free investments** account
2. Tap **Transfer out**
3. For each holding, enter how much you want to sell:
  - For unit trusts and money market funds: Enter a rand amount
  - For ETFs: Enter the number of shares
4. Tap **Review transfer**
5. Check the summary showing what's being sold, the total, and where it's going
6. Tick the box confirming you understand the withdrawal affects your lifetime contribution limits
7. Tap **Transfer**

Your sell order is placed with the fund manager. The running total at the top of the first screen updates as you type, so you can see the estimated value before committing.

## Getting the money to your bank

Once the sale settles, the proceeds appear in your Cash account. From there, withdrawing works exactly like any other Fynbos withdrawal.

1. Navigate to your **Cash** account
2. Tap **Withdraw**
3. Enter the amount and select your linked bank account
4. Review and confirm

Withdrawals from Cash are covered in full in [Withdrawals](#uf796dPXt).

## Withdrawal timeline

Selling holdings takes time to settle, which is why a TFSA withdrawal is slower than moving money between instant-access accounts.

| Step | Timing |
| --- | --- |
| Sell order placed | Immediate |
| Holdings sold and settled | About 6 business days |
| Proceeds appear in your Cash account | On settlement |
| Bank withdrawal from Cash | 1-2 business days |

The transaction detail for the sale shows the expected settlement date and tells you if settlement is running longer than expected.

## Understanding contribution limit impact

When you withdraw from your TFSA, you permanently lose that contribution space. This is a key difference from regular savings accounts.

**How it works:**

- South Africa allows R46,000 in TFSA contributions per tax year
- There's also a R500,000 lifetime contribution limit
- Withdrawals do not restore your contribution allowance

**Example:**

If you've contributed R100,000 over several years and withdraw R20,000, your lifetime contribution total remains R100,000. You cannot re-contribute that R20,000 without it counting toward your limits.

**What this means for you:**

- Only withdraw from your TFSA when you truly need the money
- Consider withdrawing from other accounts first if possible
- Your TFSA is best suited for long-term goals where you won't need early access

## Funds on hold

Some deposits have a hold period before they can be withdrawn, even from your TFSA.

| Deposit type | Hold period |
| --- | --- |
| Direct EFT deposits | 5 days |
| Debit order deposits | 60 days |
| Referral bonuses | 1 year |

When you start a transfer out, you'll see your available balance and any funds currently on hold displayed separately.

## Alternatives to withdrawing

Before selling out of your TFSA, consider these alternatives:

**Move an existing TFSA to Fynbos instead**

If you have a TFSA elsewhere and want to consolidate, request a transfer from your Tax-free investments account. A transfer preserves your allowance, where a withdraw-and-recontribute would burn it. See [Switching to Fynbos](#uf796dPXt).

**Change your investment strategy**

To move money between funds inside your TFSA, edit your strategy rather than withdrawing. Rebalancing within the account does not touch your contribution limits. See [Investment strategy](#uf796dPXt).

**Withdraw from other accounts first**

If you have money in your Cash account, Emergency Savings, or Savings pots, consider withdrawing from there instead to preserve your TFSA contribution space.