New year, new TFSA limit.

This is what you need to know for 2020.

Hi There,

Can you believe its a new year already!? 2020 is a new year and brings a new opportunity to contribute to your TFSA.

Here are a few things you'll need to know for 2020:

• Contributing to your TFSA in 2020 after Withdrawing in 2019

  If you withdraw from your TFSA in one year, you need to wait for the next calendar year to add the amount back in to your TFSA. Because you withdrew in 2019, the full amount can now be added back to your account. If you withdrew in USD, it is the CAD equivalent that is added back to your available contribution room. TFSA rules are provided by the CRA, and may change from year to year, so visit the CRA website to ensure you're aware of any changes, or speak to a professional tax advisor for more information.

• Annual TFSA Contribution Limit for 2020

  Canada Revenue Agency has announced that the annual contribution limit for 2020 is $6,000.

• How To Check Your Annual Contribution Limit

  Your TFSA contribution limit may be different from the annual limit if you have available contribution room from previous years or if you withdrew from your TFSA in the past. To check your contribution limit, visit My Account or MyCRA on the CRA website. It’s a good idea to keep your own record of your contributions and withdrawals made in the previous year because these may not be reflected in your current-year TFSA contribution room until after the end of February. CRA charges a 1% monthly penalty on contributions over your limit.

Shafik Hirani, B.Comm, CIFP, CLU®, RRC