This work investigates the performance of silicon-on-insulator (SOI) based vertical heterojunction tunnel FET with magnesium silicide (Mg2Si) as source material (Mg2Si-VTFET) with silicon-based counterpart (Si-VTFET). The investigation utilizes SILVACO TCAD tool to analyse various metrics including electrical characteristics, radio-frequency performance, linearity, and distortion. Incorporation of low bandgap material at source forms hetero-junction at source-channel interface, thereby reducing the tunneling path and enhancing the tunneling rate of charge carriers. ON-state current (I-ON) and current switching ratio (I-ON/I-OFF) for Mg2Si-VTFET improves by factor of approximately similar to 10(5) and 10(2) times. Mg2Si-VTFET outperforms Si-VTFET in terms of I-ON current for low biasing voltages, transconductance (g(m)), gain-bandwidth-product (GBP), cut-off frequency (f(T)) and transit-time. However, Mg2Si-VTFET has better linearity and reduced distortions in terms of VIP2 and HD2 metrics. HD2 suppresses by 53.8 % for Mg2Si-VTFET over Si-VTFET. This suggests that Mg2Si-VTFET is better suited for applications requiring low distortion, such as in audio amplifiers or communication systems. Therefore, Mg2Si-VTFET shows strong candidacy over Si based counterpart for low power circuits.