A Tax-Free Savings Account (TFSA) enables you to generate regular dividend income without creating a tax bill. The strategy can become even more attractive with stocks that distribute dividends every month. Monthly payouts give investors more frequent cash flow, which they can reinvest sooner or use to cover recurring expenses.
That said, the frequency of dividend payments shouldn’t be the main reason to own a stock in a TFSA. Investors should instead focus on TSX stocks with solid fundamentals, sustainable cash flows, and a strong track record of maintaining their dividends.
Here is a TSX-listed dividend stock that looks perfect for a TFSA to generate steady cash. It offers monthly dividend payments along with a compelling yield of approximately 6.7%.
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A perfect monthly dividend stock for a TFSA
For investors looking to generate steady monthly income from their TFSA, SmartCentres REIT (TSX: SRU.UN) could be worth considering. The REIT owns a diversified mix of retail and mixed-use properties, with a strong presence in markets where demand remains high. This geographic and property diversification drives occupancy across its portfolio and consistent leasing activity.
The REIT also benefits from a solid tenant base, which helps provide dependable rental income and supports long-term tenant retention.
SmartCentres REIT currently distributes $0.15 per unit each month, yielding about 6.7%.
Into SmartCentres’ recent quarterly performance
SmartCentres REIT maintained strong performance during the first half of the year, with its resilient retail operations providing a solid foundation for continued growth. The company’s underlying retail momentum remains encouraging and could support further improvement in the coming quarters.
As of June 30, 2026, occupancy was 98.1%, up 0.5% quarter-over-quarter, indicating continued healthy demand for the company’s properties. Robust leasing activity has also allowed SmartCentres to push rents higher. At the same time, steady demand for retail space and strong tenant retention are supporting the growth of net operating income (NOI) and funds from operations (FFO).
The company also made significant progress in renewing leases set to expire in 2026, with approximately 86% already renewed. Excluding anchor tenants, these renewals generated an average rent increase of 12%. This meaningful uplift reflects the strength of SmartCentres’ leasing environment and its ability to capture higher rents from existing tenants.
SmartCentres REIT poised for steady growth and sustainable distributions
SmartCentres REIT appears well placed to maintain its monthly distributions, supported by resilient demand for its retail properties. Strong occupancy levels, steady leasing activity, and rising rental rates are helping the REIT generate consistent income. As these trends continue, they should support further growth in NOI and funds from operations (FFO), providing a solid base for its ongoing distributions.
The REIT also has meaningful long-term growth potential beyond its existing properties. Its extensive land holdings and a large mixed-use development pipeline give SmartCentres additional opportunities to expand and create value over time. Together, these assets strengthen the REIT’s ability to maintain its distributions while potentially increasing them in the years ahead.
The bottom line
SmartCentres REIT stands out as an attractive income stock, offering a 6.7% yield with reliable monthly distributions. High occupancy, strong rent growth, and a solid leasing pipeline support sustainable cash flow. Moreover, its development potential offers additional avenue for long-term growth.
Overall, SmartCentres REIT is a compelling option for TFSA investors seeking dependable monthly cash flow.
