TAX FREE SAVINGS CONTRIBUTION LIMITS & RULES

Following are the annual Tax Free Savings Account contribution limits by year up to and including 2019.  

2009 -  $  5,000

2010 -  $  5,000

2011 -  $  5,000

2012 -  $  5,000

2013 -  $  5,500

2014 -  $  5,500

2015 -  $10,000

2016 -  $  5,500

2017 -  $  5,500

2018 -  $  5,500

2019 -  $  6,000

The annual contribution limits above are cummulative. You do not lose your contribution room should you not maximize your TFSA in any given year. The current total amount an individual can contribute is $63,500.

Amounts withdrawn in any calendar year cannot be placed back into the TFSA until the following tax year, if you have maximized your contributions. This is not considered a contribution.

The formula for determining your TFSA limit is as follows:

Unused TFSA contribution room to date + Total withdrawal made in this year + next year's TFSA dollar limit = TFSA contribution room at the beginning of next year.

What happens at death?

The owner of a TFSA has two options when establishing the account in terms of what they wish to happen to the proceeds at their death.

A)  Successor Holder: proceeds may be transferred tax free at death to spouse or common - law partner. Only a spouse or common - law partner may be named a Successor Holder.

B) Beneficiary:  This is more detailed. If your spouse is named as the beneficiary (as opposed to Successor Holder) the proceeds up to date of death may be transferred tax free to their TFSA up to Dec. 31 of the following year, without affecting the spouse's TFSA contribution limit. However, the spouse must file CRA form RC240 within 30 days after the contribution is made.

A beneficiary, other than spouse or common - law partner may also have the proceeds transferred directly to their TFSA but only if they have the TFSA contribution room.

For any additional information, please email Bob at robert.davies@manulifewealth.ca

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