Investors focused on creating wealth could leverage a Tax-Free Savings Account (TFSA). Because all capital gains, dividends, and other investment income earned within a TFSA are tax-free, it can provide a meaningful boost to overall returns, especially if capital gains are large.
This calendar year, the TFSA annual contribution limit is $7,000. While this is the maximum amount that can be contributed for the year (excluding unused contribution room), the account’s withdrawal rules create an opportunity for investors to substantially increase the dollar value of their future contribution capacity.
Any funds withdrawn from a TFSA are added back to an investor’s contribution room on January 1 of the following calendar year. This means investment gains can effectively increase the dollar value of your future contribution room.
For instance, if a $7,000 investment in a TFSA doubles to $14,000 and you later withdraw the full amount, you’ll be able to recontribute that entire $14,000 in a future year, in addition to any new annual contribution limit. In other words, strong investment performance can significantly increase the TFSA contribution amount.
With that background, here are two growth stocks with solid prospects to add to your TFSA to double your contribution room.
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Growth stock #1: Celestica
Celestica (TSX: CLS) is a solid growth stock to add to your TFSA. The company is well-positioned to capitalize on the Artificial Intelligence (AI) infrastructure boom, as hyperscalers continue to invest heavily in data centres.
The Connectivity & Cloud Solutions (CCS) segment is growing rapidly. It provides advanced networking switches, server platforms, data centre interconnect technologies, edge computing systems, and enterprise storage solutions critical to AI-driven workloads.
The strength of this business was again evident in the second quarter, when CCS revenue surged 84% year over year to US$3.8 billion, contributing 81% of total company revenue. Within CCS, Communications revenue climbed 62%, driven by robust demand for 800G networking switches and sustained momentum in 400G products. Enterprise revenue soared 167%, reflecting the rapid expansion of AI/ML compute programs for a major hyperscale customer and stronger storage demand.
Although the stock recently retreated following a US$3 billion equity offering, the decline presents an attractive entry point. The capital raise is intended to support multi-year customer demand.
Looking ahead, the continued adoption of 800G networking, the commercial ramp-up of 1.6-terabit networking products, improving enterprise storage demand, and sustained growth in hyperscaler AI/ML compute position Celestica to deliver strong growth and meaningful returns.
Growth stock #2: Shopify
Shopify (TSX: SHOP) remains an attractive long-term growth stock and could be a valuable addition to a TFSA. Despite its growing scale and challenging year-over-year comparisons, the e-commerce leader continues to post impressive financial results.
In its latest quarter, the Canadian technology giant delivered another strong performance, easing concerns about rising competition in the AI space. Gross Merchandise Volume (GMV) climbed 32% year over year to US$116 billion, supported by healthy demand across merchants of all sizes, regions, and sales channels. Revenue advanced 34% to US$3.6 billion, while free cash flow margin reached 18%, marking the fifth consecutive quarter of GMV growth above 30%.
Growth remains broad-based, with larger merchants contributing meaningfully. Businesses generating between US$2 million and US$25 million in sales continue to drive the largest share of incremental GMV, while the fastest expansion is occurring among merchants exceeding US$25 million in annual sales.
Shopify is also gaining traction beyond online retail. Offline GMV increased 32%, highlighting stronger adoption of its unified commerce platform by larger retailers. Meanwhile, B2B commerce emerged as another key growth engine, with GMV surging 76% year over year. Its payments ecosystem is also expanding rapidly, with Shop Pay continuing to gain momentum.
With growing adoption of its platform, accelerating offline and B2B activity, expanding payment volumes, and ongoing AI investments, Shopify appears well-positioned to benefit from the long-term shift toward omnichannel commerce while delivering sustained earnings and shareholder value.
