TFSA Withdrawals and the Re-Contribution Rule*

 

Tax Free Savings Account (TFSA)

Introduced in 2009 to help Canadians grow their savings and investments tax free

 

By 2023 the Maximum Contribution Limit is $88,000 if in 2009 you were:

  • Age 18 or older
  • A Canadian resident
  • Had a valid Social Insurance Number

 

TFSA Withdrawals and Re-Contribution Rules:

  • If you maximized your TFSA contribution limit, you can not re-contribute in the same calendar year of the withdrawal. Revenue Canada allows you to re-contribute in the new calendar year.
  • If you have not maximized your TFSA contribution limit, you can carry forward any unused contribution room. You can contribute to the TFSA in the same calendar year of the withdrawal provided you have available contribution room.
  • Revenue Canada charges a 1% penalty each month for any excess contribution

 

*The maximum contribution limit will increase with each year