Curious about how much TFSA contribution room you have left? Our TFSA contribution limit calculator can help you figure that out. If you know how much you’ve contributed and withdrawn from your TFSA, our calculator can determine how much room you have left.
On this page you’ll find
How much can you put into your TFSA each year?
The Tax-Free Savings Account (TFSA) has the same annual contribution limit for all Canadians. This is different from the Registered Retirement Savings Plan (RRSP), which determines contribution room based on a person’s income level. Every so often the annual TFSA contribution limit is increased, to adjust for inflation.
Any Canadian can open a TFSA if they are 18 years or older and have a Social Insurance Number (SIN). If you were over the age of 18 in 2009 — the first year TFSAs were available — or later, then you’ve been accumulating TFSA contribution room. Your available contribution room accumulates even if you haven’t started putting money into a TFSA.
If you contribute the full annual amount to your TFSA every year, then you would have reached the limit of your contributions. You’d need to wait until the next year to put in more money, when the new annual contribution room is added. If you put in more money than your limit allows, this could result in fees and penalties.
However, if you haven’t contributed the maximum amount every year, then your TFSA would still have contribution room in it. That means you can contribute more than the current year’s annual limit, because you still have leftover room from previous years.
How can you find out your TFSA contribution room?
If you’re not sure how much contribution room you have available in your TFSA, there are a couple of ways you can find out. You could check your:
- CRA My Account – This will show you your available contribution room for your TFSA as well as your RRSP, as of the previous year.
- Notice of Assessment – After you file your taxes each year, you’re sent a Notice of Assessment. It includes your RRSP and TFSA contribution room.
Depending on when you check your contribution room information, it may not be fully up to date. For example, your CRA MyAccount will not be up to date if you check it in January or February. This is because TFSA issuers have until the end of February to share their records for the previous calendar year.
You can calculate your TFSA contribution room using our calculator, below. To use this calculator, make sure you have:
- How much you’ve contributed to your TFSA up to this year.
- How much you’ve withdrawn from your TFSA up to this year.
How do TFSA withdrawals affect your contribution room?
You can withdraw money from your TFSA at any time. However, withdrawals don’t reduce your contribution room immediately — this does not get updated until the following year.
This is important to keep in mind, because if you re-deposit the money into your account in the same calendar year, this could end up being counted as an over-contribution. An over-contribution results in a penalty of 1% of the excess amount, for each month it stays in your account.
If you re-deposit the money in your TFSA the following year, then you will have new contribution room available. This will help reduce the chance of making an over-contribution.
The Canada Revenue Agency (CRA) updates your available contribution room annually, but not more frequently than that. So, it’s a good idea to keep track of your contribution room for the current year, so that you can have the most up to date information. If you work with a financial advisor, this is also something they can help you with.
How do investment earnings affect your TFSA contribution room?
Your TFSA can hold savings or investments. While your money is in the account, your savings grow tax-free, which means you don’t pay tax on the interest or investment earnings. And your money isn’t taxed when you take it out of your TFSA.
Any interest or investment earnings you earn do not affect your TFSA contribution room for current or future years. Your contribution room is only affected by how much money you deposit into the account yourself.
Summary
TFSA contribution room is the same amount each year for all Canadians. Keep in mind:
- Your personal contribution room depends on how many years you’ve been eligible for a TFSA account, and how much you’ve already contributed to your TFSA.
- If you make a withdrawal, your available contribution room isn’t updated to reflect the withdrawal until the following year.
- You may need to wait until the next year to re-deposit the money, otherwise it will count as an over-contribution.
- Your investment earnings in your TFSA do not affect your available contribution room.
