Many Canadian companies reward shareholders with regular payouts. However, only a few have a resilient business model and growing earnings base to consistently pay and even increase their dividend. These dependable TSX stocks are perfect for generating worry-free passive income for decades in your Tax-Free Savings Account (TFSA).
Notably, investing in high-quality dividend stocks through the TFSA will result in an income that is free of tax. Moreover, reinvesting those dividends can help create significant wealth over time.
With this background, here is a reliable dividend stock well-suited to generate steady passive income for your TFSA.
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The high-yield dividend stock with a sustainable payout
While the TSX has many reliable dividend stocks, Canadian communications giant Telus (TSX:T) appears perfect for a TFSA due to its stellar payout history, consistent dividend growth, high yield, and visibility over future payouts. Since 2004, the telecom company has returned more than $23 billion to investors through dividend payments. Moreover, it has increased its dividend 27 times in the past 14 years, reflecting its commitment to rewarding shareholders.
Most recently, Telus raised its quarterly dividend by 7%. Moreover, the communication giant offers an attractive yield of over 7.3%. Its high yield is supported by a steady earnings base and payout ratio of 60–75% of free cash flow, which is sustainable in the long term.
Telus to consistently raise its dividend
Telus is one of Canada’s most reliable dividend growth stocks. Its payouts are supported by its ability to deliver profitable growth driven by ongoing investments in its broadband and wireless networks, most notably in PureFibre and 5G infrastructure. These upgrades are translating into new customer growth. In the second quarter of 2025, Telus added 198,000 new subscribers, while its postpaid churn rate has remained below 1% for more than a decade, a sign of strong customer loyalty.
The company’s long-term investments in network expansion are helping it capitalize on opportunities in emerging sectors. Its connected device subscriber base is expanding, largely thanks to the rising adoption of Telus’ Internet of Things (IoT) solutions. Meanwhile, Telus Health has emerged as one of the company’s fastest-growing businesses. In the most recent quarter, the division delivered operating revenue growth of 16% and adjusted EBITDA growth of 29%. Its focus on product innovation, expanding global sales channels, strategic investments, and efficient cost management is driving growth.
At the same time, Telus continues to focus on operational efficiency, which will likely cushion its earnings and payouts. With profitability rising and capital expenditures starting to ease, the company is in a strong position to support long-term dividend growth.
Management aims to raise dividends by 3% to 8% annually through 2028. Telus’ growing subscriber base, revenue diversification, and ongoing cost-reduction efforts position it well to pay and increase its future dividend.
The bottom line
Telus has a strong track record of paying dividends and is committed to increasing them over time, making it an attractive choice for TFSA investors. The communication company currently pays a quarterly dividend of $0.416 per share. The table below shows that if you own 1,000 shares in your TFSA, you’d receive $416 every quarter, adding up to $1,664 per year, all tax-free.
| Company | Recent Price | Number of Shares | Dividend | Total Payouts | Frequency |
| Telus | $22.70 | 1,000 | $0.416 | $416 | Quarterly |
