How to determine your TFSA contribution limit

Jun 2, 2021

Knowing how much tax-free savings account (TFSA) contribution room you have available will help you take maximum advantage of tax-sheltered growth potential, and also help you avoid over-contribution penalties.

How much contribution room do you have? For a given year, your TFSA contribution room is the total of:

  • your annual TFSA contribution limit
  • any unused contribution room from the previous year
  • any withdrawals made from your TFSA in the previous year

If you have multiple TFSAs, your combined contributions to all of them cannot exceed your available contribution room for the current year.

2021 $6,000
2020 $6,000
2019 $6,000
2018 $5,500
2017 $5,500
2016 $5,500
2015 $10,000
2014 $5,500
2013 $5,500
2012 $5,000
2011 $5,000
2010 $5,000
2009 $5,000
Total $75,000

 

How to check your TFSA contribution room

The Canada Revenue Agency (CRA) tracks your contribution room. You can see your TFSA balance as of January 1 of the current year by logging in to your online “My Account” on the CRA website. Or you can get your balance by phoning CRA’s Tax Information Phone Service: 1-800-267-6999. Check after mid-February, to allow time for your financial institution to report all your TFSA transactions from the previous year. Ideally, keep track of those transactions yourself to ensure you don’t over-contribute.

Contribution room carry-forward

If you can’t contribute the maximum allowable in a given year, you can catch up in the future. Unused contribution amounts can be carried forward indefinitely and used in subsequent years.

Withdrawals can be re-contributed

TFSAs are flexible. You can withdraw funds any time and the amounts withdrawn in a given year are added back to your contribution room for the next year. For example, you can withdraw an amount in December, then re-contribute that amount in January.

Over-contribution penalty

There is a penalty if you accidentally contribute more than your allowable limit. In that case, a tax equal to 1% of the highest excess TFSA amount in the month will be applied for each month that you are in an excess contribution position.

For more information about contribution limits, visit the TFSA section of the Canada Revenue Agency website.

Learn more about Qtrade Direct Investing™. 

Online brokerage services are offered through Qtrade Direct Investing, a division of Credential Qtrade Securities Inc. Qtrade, Qtrade Direct Investing and Write your own future are trade names and/or trademarks of Aviso Wealth.

Recent Posts

Aviso Weekly Market Pulse: July 8th – July 12th

Market developments Equities: The S&P 500 Index climbed to around 5,615 to end the week, showing signs of recovery despite the tech-led selloff in the Thursday session. Major banks kicked off the earnings season with mixed results. Wells Fargo saw a 7% decline due...

Aviso Weekly Market Pulse: July 1st – July 5th

Market developments Equities: Even with a short trading week, the U.S. stock market is approaching new all-time highs, with the S&P 500 on track for its 34th record this year. Traders are focusing on potential Federal Reserve rate cuts despite signs of economic...

The most tax-advantaged sources for a home down payment

If you’re in the market for a home, don’t leave money on the table when saving for your down payment. We’re sharing the different tools you have available to you as a Canadian first time home buyer to save in the most tax-advantaged way. In this article: Down payment...

Aviso Weekly Market Pulse: June 24th – June 28th

Market developments Equities: Stocks rallied towards new all-time highs this week as cooling inflation data strengthened expectations for Federal Reserve interest rate cuts in 2024. The S&P 500 Index touched above 5,500, led by technology stocks, while the Nasdaq...

NEI Monthly Market Insights: May 2024

Equities continue the rally, but economic paths diverge After a brief respite in April, global equities resumed the rally to find higher ground in May, as ongoing moderation of inflation and resilient economic trends continue to boost investor optimism. The S&P...

Aviso Weekly Market Pulse: June 17th – June 21st

Market developments Equities: The U.S. markets experienced a significant options expiration event known as "triple witching," with an estimated $5.5 trillion in contracts set to expire. This event is causing volatility in the stock market, particularly affecting...