TFSA investors: Earn $345/month tax-free passive income with these 4 dividend-paying stocks

For 2022, the Canada Revenue Agency has kept the TFSA (Tax-Free Savings Account) contribution room unchanged at $6,000, with the lifetime contribution increasing to $75,500. So, by investing the entire amount in stocks that pay 5.5% dividends, investors can earn a tax-free monthly passive income of $345. So if you like earning stable passive income, here are four Canadian stocks that pay monthly dividends with yields above 5.5%.

Pembina pipeline

With a forward dividend yield of 6.33%, Pembina pipeline (TSX:PPL)(NYSE:PBA) is my top choice. The company operates a highly regulated business, with approximately 90% of its adjusted EBITDA generated through long-term contracts, thereby stabilizing its finances and cash flow. These strong cash flows have allowed the company to pay dividends continuously since 1997.

Meanwhile, Pembina Pipeline has a strong portfolio of projects. It hopes to commission $900 million worth of projects this year while having about $4 billion worth of projects in the development stage. Growing demand for energy could increase its asset utilization, which would boost its finances. So given its healthy growth potential and strong underlying business, I believe Pembina Pipeline’s dividend is safe.

NorthWest Healthcare Properties REIT

Northwest Health REIT Properties (TSX: NWH.UN) pays a monthly dividend of $0.0667 per share, with a forward yield of 5.97%. The company owns and operates 192 healthcare properties across Canada, Australia, New Zealand, Brazil, the United Kingdom and Germany. Given its defensive and diversified portfolio, its occupancy and collection rate remains high, whatever the economic cycle. Its long-term contacts and government-backed tenants are also stabilizing its finances, allowing it to pay out a dividend at a healthier pace.

Meanwhile, NorthWest Healthcare has approximately $1 billion worth of projects underway. It is also working on closing acquisitions to increase its presence in Europe, Australia and Canada. In addition, it strengthened its financial position by raising around $200 million in June through new securities issues. So, given its stable cash flow, healthy growth prospects and attractive yield, NorthWest Healthcare would be a great buy for investors looking for income.


My third choice is Keyera (TSX:KEY), an energy infrastructure company serving oil companies in Western Canada. With rising oil prices, exploration and production activities have increased, increasing demand for the company’s services. Amid growing demand, Keyera plans to invest approximately $560 million to expand its asset base.

It is also continuing construction of the KAPS pipeline project, which could be operational early next year. Thus, the company’s growth prospects appear healthy. In addition, the company derives approximately 70% of its cash flow from fee-for-service or take-or-pay contracts, which provides stability in its cash flow. Thus, supported by its strong cash flow, Keyera has increased its dividends at a CAGR of 7% since 2008.

Given its excellent balance sheet, healthy growth prospects and strong liquidity of $1.6 billion, Keyera is well positioned to continue to increase its dividends. Meanwhile, its forward yield currently stands at 6.59%.

Pizza Pizza Royalty

My last choice is Pizza Pizza Royalty (TSX: PZA). It operates Pizza Pizza and Pizza 73 brand restaurants through franchisees. Its highly franchised business model generates predictable and stable cash flow, allowing it to pay dividends at a healthier pace. Currently, it pays a monthly dividend of $0.06 per share, with a forward yield of 5.51%. Meanwhile, Pizza Pizza Royalty had bolstered its digital, delivery and pickup channels amid the pandemic, which could continue to boost its finances in coming quarters.

In addition, improving economic activities, increased vaccinations and reopening of restaurants may also boost the company’s finances in the coming quarters. Moreover, the company also focuses on product innovation and effective marketing campaigns to boost its finances. So, Pizza Pizza’s growth prospects look healthy.

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