The Canada Revenue Agency (CRA) has raised the Tax-Free Savings Account (TFSA) contribution limit by $7,000 in 2026. This brings the maximum cumulative TFSA contribution room to $109,000 this year.
Introduced in 2009, the TFSA is a popular registered account in Canada. Any returns generated in the TFSA originating from qualified investments are exempt from taxes. These qualified investments include stocks, bonds, exchange-traded funds, mutual funds, and guaranteed income certificates, among others.
Canadians with a long-term investment horizon can consider adding equity exposure to their TFSA. Equities are an asset class that has consistently outpaced inflation over time.
Most investors should invest in stocks through low-cost index funds that offer diversification and reduce overall risk. However, those with a higher risk appetite could own individual stocks and benefit from market-beating returns.
In this article, I have identified two top TSX dividend stocks Canadians can hold in a TFSA right now.
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A blue-chip dividend stock to own today
Valued at a market cap of almost $16 billion, Stantec (TSX:STN) provides professional infrastructure and facilities services globally.
It offers engineering, architecture, environmental, and planning solutions across water resources, buildings, energy, and urban development sectors. Services include design, project management, construction administration, and environmental remediation for public and private clients.
Over the past decade, Stantec stock has returned close to 400% to shareholders, after adjusting for dividend reinvestments.
Stantec’s growth story is far from over. According to consensus estimates, between 2024 and 2028, the company is forecast to increase:
- Revenue from $5.87 billion to $10.1 billion.
- Adjusted earnings from $4.42 per share to $9.35 per share.
- Free cash flow from $380 million to $1.12 billion.
A growing cash flow base should translate to consistent dividend hikes. Stantec has raised its annual dividend from $0.30 per share in 2012 to $0.90 per share in 2025.
Today, STN stock is trading at 25 times forward FCF, above the 10-year average of 22 times. If it maintains its historical multiple, Stantec stock could return 55% to shareholders over the next two years.
Given consensus price targets, Stantec stock trades at a 22% discount in January 2026.
Is this recession-resistant stock undervalued?
Down 17% from all-time highs, Waste Connections (TSX:WCN) has returned over 1,000% to shareholders in dividend-adjusted gains since 2016.
Waste Connections provides comprehensive non-hazardous waste management services across the United States and Canada. The company offers collection services to residential, commercial, municipal, industrial, and oil and gas exploration customers.
Services include landfill disposal, recycling of materials like cardboard, plastics, and metals, and waste transfer operations via truck, rail, and barge.
WCN specializes in exploration and production waste treatment, including drilling fluids, produced water, and contaminated soil remediation. Additional services include intermodal cargo transportation and equipment leasing.
Operating in a recession-resistant industry, Waste Connections is projected to expand adjusted earnings per share from US$4.79 in 2024 to US$7.65 in 2029.
If WCN stock trades at its historical average earnings multiple of 34 times, it should gain 56% over the next three years. Given consensus price targets, the TSX dividend stock is priced at a 22% discount in January 2026.
