Tax-free monthly income sounds small until it starts showing up like clockwork. Inside a Tax-Free Savings Account (TFSA), the right income stock can turn a simple holding into a reliable stream of cash you don’t have to share with the taxman. The best fits are usually companies with steady cash flow, durable demand, and a distribution that looks well covered by the business. Chemtrade Logistics Income Fund (TSX:CHE.UN) fits that profile better than many investors realize, especially for someone who wants income first and excitement second.
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Chemtrade stock is not some flashy tech stock. It produces and distributes industrial chemicals used in water treatment, pulp and paper, oil and gas, and other essential industries across North America and Brazil. That matters for TFSA income investors as demand for those products tends to stay fairly steady even when the economy slows. Over the last year, Chemtrade has also kept expanding its water business, including the November 2025 closing of its Polytec acquisition, which added more exposure to recurring water-treatment demand.
Recent news has also been friendly to income investors. In January 2026, Chemtrade stock raised its monthly distribution to $0.06 per unit, up from $0.0575, marking its third straight annual increase. Then in April 2026, it declared another $0.06 monthly distribution, payable in May. That kind of consistency stands out.
Into earnings
The earnings story backs that up. For 2025, Chemtrade stock reported revenue of $2 billion, up 11.8% year over year, and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $507.4 million, the highest annual level in its history. Distributable cash after maintenance capital expenditures reached $228 million, or $1.99 per unit, up from $1.80 per unit in 2024. Better pricing for merchant acid, Regen acid, caustic soda, and sodium chlorate helped push results higher, even with some pressure from lower chlorine pricing and softer Metric Electrochemical Unit (MECU) volumes.
The valuation still looks reasonable for an income name with that kind of performance. Chemtrade stock recently traded with a market cap of roughly $1.9 billion. With an annualized distribution of $0.72, the yield sits around 4.3% at writing, paid monthly. The units also trade at about 14 times earnings, which doesn’t look stretched for a business coming off record EBITDA and still guiding for another strong year.
Future focus
The forward outlook is where the TFSA case gets stronger. Chemtrade stock expects 2026 adjusted EBITDA to land between $485 million and $525 million. That range sits close to its record 2025 performance, which suggests management believes current strength can hold rather than vanish after one good year. The company also expects an implied payout ratio of about 45% at the midpoint of guidance. That leaves a decent cushion for the distribution while still giving it room to invest in growth projects and protect the balance sheet.
Why does it fit a $90-a-month TFSA goal so well? Because the math is simple. At $0.06 per unit each month, you’d need 1,500 units to generate $90 monthly, or $1,080 annually, before any reinvestment. At roughly $17 per unit, that works out to an investment of about $25,365.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | ANNUAL DIVIDEND | ANNUAL TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| CHE.UN | $16.91 | 1500 | $0.72 | $1,080 | Monthly | $25,365 |
That’s not tiny, but it’s also not some impossible number for a long-term TFSA builder. Better still, every monthly payment stays tax-free inside the account. The main risks are commodity pricing swings, industrial demand changes, and the fact that acquisitions always need good execution. Even so, the cash flow coverage gives this income story real substance.
Bottom line
If your goal is to build $90 a month in tax-free TFSA income, Chemtrade stock looks like a practical place to start. It has a monthly payout, a reasonable yield, record recent results, and a business tied to essential chemical demand rather than hype. That doesn’t make it risk-free, but it does make it useful. For investors who want steady income without overcomplicating things, this one looks like a smart fit.
