8 TFSA Mistakes You Must Avoid

[@Andres_853]

Good one, One of the biggest mistakes is over-contributing to your TFSA. The Canada Revenue Agency (CRA) imposes a penalty tax of 1% per month on the excess amount, so always keep track of your contribution limits.

[@Sanchyfab]

Another common mistake is withdrawing funds and then re-contributing the same amount within the same year without considering your contribution room. This can lead to over-contribution penalties if you're not careful.

[@har0ld551-hn6fm]

It’s also crucial to avoid using your TFSA like a regular savings account. TFSAs are meant for long-term growth, so investing in higher-yield assets like stocks and mutual funds rather than just holding cash can maximize your tax-free gains.

[@V.stones]

A big error is not considering the impact of non-residency. If you contribute to your TFSA while you’re a non-resident of Canada, you'll incur a 1% per month penalty on those contributions, so it's essential to understand the residency rules.

[@Jonesmatsunaga]

These are great tips. I’ve been considering consulting a financial advisor to ensure I’m using my TFSA correctly

[@camela8445Mar]

Recently, I've been considering the possibility of speaking with consultants. I need guidance because I'm an adult, but I'm not sure if their services would be all that helpful.

[@bdgies2721]

And this is why it pays to have a good financial advisor. Mine has explained all this to me and it’s working perfectly. My husband died 18 months ago, and his TFSA was slipped over into mine just has you said. One thing I learned as executor of my mother-in-law’s estate 6 years ago was to close the deceased’s TFSA account and distribute it to the beneficiaries as soon as possible. It falls outside the estate, and while the account holder doesn’t pay tax on withdrawals, any interest accumulated after death is deemed taxable.

[@unclemick-synths]

Great advice. Thanks!

[@onebluemonster239]

Use successor holder tip from this video and avoid that tax impact

[@bdgies2721]

@@onebluemonster239 yes, but as an executor, I can only work with what is in place. I wouldn’t have known about the immediate dispersal were it not from the very helpful bank personal. That was one of the most educational processes I ever went through. It informed subsequent executor duties as well as my husband’s estate and the drafting of my own documents. My TFSA has assigned beneficiaries, and they will pay no taxes.

[@treysterok4321]

My condolences 💐

[@RangerKamloops]

These short, concise videos are my favorite. Keep them coming!

[@kellyinPH]

Once you truly understand the TFSA it is the best thing about Canada

[@AxeCheeks]

Best thing Harper did

[@bluesideupfl510]

Great it is but behind the times in a big way. The UK allows 20000£ a year per person. You can put in 9000£ a year per child. Thats a real TFSA!

[@AxeCheeks]

@andrewforster9941 true the moderate annual caps are small. I guess they want us to save for our futures but not THAT much.

[@createone100]

I agree!

[@MetalSStar196]

@@bluesideupfl510 Erm, my TFSA contribution room is still over $70k... I live in Canada.

[@davidmcquaid2557]

I take the yearly allowed limit, divide by 52 weeks and contribute that way. I've been lucky enough to reach the max limit minus the weekly payments I have left for 2024. Currently my TFSA is worth $36K more that I have put in and I am thrilled.

[@MetalSStar196]

That's easy to accomplish if you're making more than $30k/yr, mathematically speaking.

[@derekcox6531]

One thing I wish the government would do is promote the tfsa as a really outstanding way for people in lower income brackets to invest for retirement. Perhaps it doesn’t benefit the government to promote something which goes against their narrative that higher TFSA room only benefits the “rich” In my estimation,a TFSA is THE best way to put something aside for retirement if you’re a lower earning family. Just my thought on it

[@lazaryanya9407]

That would be lie. You need after tax money to put into a TFSA. Lower income brackets do not have a lot of after tax money to invest. You need to think some more of what it means to be in a lower income bracket.

[@laundrygoddess4]

​@@lazaryanya9407 its better for a low earner to put it into a TFSA than an RRSP just in case they need to pull it. Yeah it might not be much but it's better than paying penalties when pulling out of rrsp

[@MrIGameHard]

@@lazaryanya9407Are you saying lower income bracket families just shouldn't invest/save because they don't have much leftover after tax? The amount of money a lower income household would save using TFSA is more than RRSP, and definitely more than a savings account or not saving at all. This comment wasn't very well thought out

[@lazaryanya9407]

@@MrIGameHard I am saying lower income households do not have money to invest. Those people have to choose where they spend their money first as they can't cover all their expenses. Basically anybody who has to carry a balance on their charge card has no money to invest.

[@playbak]

Some great points, but I would argue if you have TFSA room (and can’t max it out) use it for your everyday/emergency savings. Tax free interest! Deposits and withdrawals need to be monitored but the latter should be at a minimum. If you move money in increments of $500 or even $100 and keep a spreadsheet it’s actually quite simple.

[@ScornedRemnant]

I specifically earmark dividend paying US company stocks (not ADRs) for my RRSP, rather than my TFSA. That way, consonant with the tax treaty between the States and Canada, dividends aren't subject to 15% withholding tax, as they would be in a TFSA or unregistered US dollar account. Nice keeping 100%.

[@danielschegh9695]

My TFSA concern has always been whether or not to first max out RRSP. I think there's a cross-over point. If you are young, you'd want to max out TFSA first, then put in RRSP. As you get to middle age / peak income years with mortgage and kids you probably want to max out RRSP first, then put in TFSA if you have anything left to save. Is that correct? Here's the thinking I've always had: Suppose you have $10,000 available to put into RRSP and/or TFSA, and it won't max out either, and say you are at a 40% marginal income tax rate. What should you do? Let's suppose when you retire or withdraw it, the growth will be 10x, meaning the $10,000 will be $100,000. If you put it in TFSA, you get $100,000 out when withdrawing over whatever period. If you put it in RRSP, you get $4000 back in tax refund, so you can instead borrow $4000, put in $14,000 in RRSP, get $4000 back, pay off the loan immediately. Then when you withdraw it, it has grown 10x to $140,000. For RRSP withdrawing it is a little more complicated because marginal vs average tax rate matters. Overall, if the average tax rate you pay on withdrawing it is 28.6%, you pay a total of $40,000 in taxes on the $140,000 withdrawn and have $100,000 left over, exactly the same as the TFSA case. If you pay an average tax rate on RRSP withrawals higher than 28.6%, you'll pay more than $40,000 so have less than the TFSA case. If average tax rate is lower than 28.6%, you'll have more money left from the RRSP than TFSA. If we assume the growth rate is the same in TFSA and RRSP, and the borrowing costs (if needed) for a few months for RRSP loan is negligible, what matters is marginal tax rate (MTRE) at time of earning the money compared to the average tax rate (ATRW) of withdrawal. Let return R = (1 + MTRE)*(1 - ATRW). If R > 1, you are better off putting it in RRSP (if you use the return funds also in RRSP). If R < 1, you are better off putting in TFSA. If R = 1, it's the same either way. Your ATRW will be a fixed but unknown future amount for the average tax rate of your withdrawals in the future. However, your marginal tax rate on income earned (MTRE) changes over time. When you are young and/or low income, your marginal tax rate is likely low enough that R < 1 so TFSA is probably smarter option. Higher income years will have high MTRE so R > 1 so RRSP is the smarter option. If you can max out both, or have no savings to put into investment, then this is irrelevant. But most of us are in a situation in our lives where we have some but not enough to max out both, or sometimes not even enough to max out one of them. I know there are confounding factors like withdrawal strategies, but it's already too late then. When deciding which one to put into first, what is the correct answer and is it something like the above analysis?

[@MetalSStar196]

I just do my homework on various stocks, bonds, ETFs, etc., buy shares, and then forget. That's the best investing advice you can ever get. Sure, the market goes through fluctuations, but the less you think of your nest egg as a baby and more like a cactus houseplant, the easier it will be to just contribute to it monthly/quarterly/annually and watch it grow. On another note that's actually related to this video; if you have a lot of money to invest, be sure to look up your updated annual TFSA and RSP contribution limit and use those numbers to contribute accordingly. Print out the limits and paste it somewhere visible so that you can remember the maximum to contribute to each investment vehicle.

[@brianaspinall1831]

I max out my TFSA, then in December I transfer 10k to my RRSP.i take my refund and invest it back into my TFSA. Rinse and repeat.

[@probablyunoriginal6148]

Wow this is really smart! Do you know if this would work if instead of transferring into an RRSP you used the FHSA - would the outcome still result in a refund?

[@brianaspinall1831]

@@probablyunoriginal6148 Feel free to fact check me but I don't think so. If I had the ability to do that (own a home, so I can't ...) I would totally put money into that.

[@testing3166]

What's the benefit of doing that?

[@brianaspinall1831]

@@testing3166 I do it because I know as the calendar year ends I get the contribution room back. I also focus on my TFSA for liquidity. When you put money into RRSP you do get a refund though it's not a 1:1, plus you pay penalty if you withdraw from it early. Once you do retire, money from RRSP will be seen as income. So get tax now when you make less or get tax later when you have more. At my current rate I will make more when I retire than I make now, I would like the highest proportion I can to be tax free. I only started the end of year transfer process once I reached my total limit for TFSA.

[@testing3166]

@@brianaspinall1831 🙏 I didn't realize you can add money to a TFSA and remove it before the year end and recover that contribution space, if I understand correctly

[@justindeseckrealtor]

Great tip on the successor holder, I’ll have to double check that. Thanks for sharing.

[@TheLearningLounge]

Clear, friendly, and to the point. Many thanks!

[@kolkolster]

A good tip is you cannot day trade in the account. Which if I’m not mistaken you can’t buy and sell the same position within 1 month (I could be wrong). If they determine you have the account could become taxable and you would be in big trouble.

[@yokoschroder314]

That’s great info, which should be taught to our young adults starting their life. Recently we sold a privately held rental property. To avoid the property capital gains tax we used our RRSP contribution room to avoid/lower the tax. The $$amount of the tax return from CRA in the following year was then used to fill up the TFSA room. (Then using the TFSA amount to invest further and enjoying the growth for our future tax free withdrawals.)

[@nrqed]

About the successor holder, it does not apply in Quebec. Just thought I would point that out.

[@littleal5723]

How about avoiding frequent trading activities that will be construed by CRA as day trading (thus requiring one to report the capital gains)?

[@user-ph2fq2em2p]

Great info on the succsor holder designation for TFSA. thx.

[@ParallelWealth]

Glad it was helpful!

[@MTN99999]

Great video I just wonder what it would take to get the US 15% Tax withholding to stop within the TFSA when you have US dividends paying stocks just like the RRSP.... Do we need to get a petition going?

[@VanManDamn]

Great tips for people to be aware of, especially that Successor Holder. But one important detail that could be elaborated on is your withdrawal is added back to your contribution in the subsequent calendar year.

[@raymondlangille2886]

I think some banks prefer the word "savings account". I prefer not to use a bank for my TFSA.

[@colingoldthorpe5918]

My retirement friends literally withdraw their interest made yearly on their TFSA accounts. They use it as a lets buy ourselves something nice before we are too old to enjoy it. So their base TFSA amount has never changed at the max allowed. its been around $12K of interest a year combined for them. My TFSA seems to be averaging about 6-7% a year interest. I plan to leave it in there until i retire in 7 years so hopefully it will be around $25-$30K for each of us. which will be a nice lump to go on a retirement trip for a month.

[@ritopaual7736]

Where did u put as an investment? Mutual funds or any other? Is it ok to open tfsa in bank ? Or any oter suggestions pls thanks

[@colingoldthorpe5918]

@@ritopaual7736 Don't use a bank they are terrible financial advisors. I made the mistake of using RBC for years. I am with Sun Life but have an actual financial advisor agent. You may pay more fees but they dont make anything if you dont make anything.

[@murraytown4]

I have to push back on the notion of using the TFSA as a savings vehicle as a mistake. If your time horizon is short (eg if you are a retiree drawing down savings), it may make total sense to use the TFSA as more of a savings vehicle.

[@cwsnowpro1959]

Always learning something new with each video 🙏

[@papa7866]

short, concise and thorough. thank you for this!

[@ParallelWealth]

Glad it was helpful!

[@rossmacintosh5652]

Other mistakes relate to CRA's requirement that investments only be in designated exhages. The problem would perhaps most likely happen if you invest in a penny stock. While you might have purchased it when listed on a designated exchange, those companies can & do get 'delisted'. If for instance a company no longer meets the requirements for listing on say Canada's Venture exchange, the stock can get delisted to an another exchange that's unacceptable to the CRA. The CRA will fine you 100% and require you to urgently sell. A big fine is bad enough but because those kinds of shares can be illiquid, forced selling can result in big losses. Don't invest in volatile, illiquid, penny stocks in your TFSA (or RRSP).

[@VancouverBrent]

Its all a shit show anyway, no true price discovery in anything, its all riged, get your money out of the banking system !!

[@applecommunication8163]

Excellent advice Crucial for we beginners!Thank you!

[@luke8838]

High growth stocks are a must have in a TFSA

[@physisgaming]

Hi, great video. What if I have used tfsa as a first time home buyer under HBP. Can I still add back the amount to tfsa in the same year if I have any money left?

[@blackgrandpa7652]

Thanks for the life changing information

[@ParallelWealth]

My pleasure

[@sylviedepratto9846]

Can you do a video on investing in gold with a bank

[@COVID...19]

4:45 I tend to think rates are going a lot higher say 20%.

[@joyhuebert1219]

Should I move money from an RRSP to a TFSA?

[@SnowboardingByJR]

Great insights Adam. Quick question, what is your opinion on Fully Paid Lending (FPL), would you suggest taking advantage of this with a TFSA? Trying to understand any risks and if I should opt-out.

[@shaunofthadead]

Good info. The successor bit is definitely something I'll need to look into. A couple pieces of feedback... You emphasized how important it is to not over contribute but did not mention how to find your limit? Why not note that people can log into their CRA account to see their current (as of the start of the year anyways) contribution limit. When you were talking about the max contribution room it could be helpful to come if you included the age someone would need to be in order to get that max space. I know we can look it up and work out the numbers ourselves but all of this info is available and you're trying to make it easier. Great info either way. Thanks!

[@ParallelWealth]

Good points, but have that included in other videos on the channel. Always tough to fit everything in within my time limit!

[@sneakeraplus]

this is great info. Keep up the good work!!

[@rezaolad543]

Professionally explained. Liked the closing word; " a gift from Government".

[@ParallelWealth]

Thanks!

[@dashman2062]

Great video! Another tip I want to share (something I like to do to) if you are worried about over contributing don't put in the exact amount but maybe $25-$50 short. Eg. If your contribution room for 2024 is 7,000 put 6,950. Also I have a question about the US stocks. Based on what you said, do you think it makes more sense to buy Apple and Microsoft in the TSFA or RRSP?

[@Adman-p4j]

RIP Spouse 1 🙏

[@revans7240]

Thanks for the tip. For a successor would that apply to all of your TSFA accounts? I originally started my TFSA with RBC and for the last couple years I stared a TSFA with Wealth Simple (I am still below my overall contribution limits). Would I need to name a successor for both my RBC and WS accounts?

[@hectious4349]

What happens if for example: you transfer the full limit of $95,000 and it grows to $150,000. Then you transfer the full $150,000 to a different account. The following year, is your contribution room the 2025 added limit + $95,000 or $150,000?

[@ParallelWealth]

Plus the $150k

[@navdeepbal3378]

If I sell US securities in my TFSA, is their any withholding tax on capital gains ?????

[@colinmagee5155]

Another good information video. Main point, don't pick between RSP and TFSA for retirement savings, use both. If not enough disposable income to max out both, like myself and many others I'd bet, contribute to RSP and then contribute tax refund from that into TFSA. Great piece of advice picked up from other videos, TFSA is great to have for large one time expenses, expected or not.

[@mrslcom]

If you are in a lower tax bracket, it may be more beneficial to prioritize your contribution to TFSA only rather than a RRSP or both. RRSP is just a tax deferred vehicle and the benefit it provides may not materialize for those in the lowest tax brackets.

[@colinmagee5155]

True. Always a number of factors to consider but general 50K rule is good place to start. Under, TFSA, over, RSP or both

[@pjm3005]

it depends on your tax bracket. If you're in the two lowest tax brackets, you're better off maxing out your TFSA and ignoring the rsp.

[@lukeman1578]

Here's my question. What if you had dividends and could take out $1000 a month. Is it the same as the money you invest? I mean I made that money on dividends. Just asking.

[@prattbeats5833]

It should have been named the Tax free investing account I couldn’t agree more. I know too many people who just put money into a TFSA and don’t invest it into anything.

[@trippingwithjesse9837]

Hey can you do a video or given an option about investing in dividend stocks using a RRSP or tfsa. Any tips or strategies or if it’s even a good idea?

[@uluvthislife3933]

Tip #7 - is there a withholding tax if the dividend is immediately re-invested into shares of the company? Such as in the case of DRIPS. TY

[@truthandnothingbut]

Amazing thank you.

[@shreyasharma9130]

I came to Canada in 2018, so I’ll get the room from 2018 or 2009? Thank you

[@ronm6585]

Thanks Adam.

[@ParallelWealth]

You bet!

[@SebastianJohnson-rn9ud]

If I haven't opened a TFSA until this year (2024) But am born in 1996, would I have only the $7k from 2024 in the account or would I have the whole amount from 2016 to 2024 as my contribution room?

[@Niibin]

Is contribution the same as interest made on the account? or is what is in your account the contribution (7,000) + interest made?

[@AlwaysUp10]

Right now I’m using my tfsa as a savings but still invested in the market. Once the time is right I will pull out for a house down payment. Thoughts?

[@Jyoutube282]

Question about contribution room. I have my TFSA maxed out in a Wealthsimple account. I have 13 stocks that all paid dividends. I get roughly $1000 a month from that. But my question is now that my TSA total is maxed out do the dividends go towardmy total contribution room? Also, if I pull the dividends which do not get reinvested out, is that going against my yearly withdrawals? Hope that makes sense.

[@hpjunkie69]

FANTASTIC INFO !!

[@ParallelWealth]

Thanks for watching!

[@hpjunkie69]

@@ParallelWealth always a pleasure watching your very informative videos. Keep up the great work

[@AndreasinThailand]

enjoy your great videos, I pulled some money out last year, but CRA didn't add all of it back in the over all limit listed on line. How do you ask CRA to correct?

[@ParallelWealth]

Contact Service Canada

[@johnlomoro411]

Can I add a piece of property to my TSFA? What would happen if I sell at 2 x s the value i.e.. what happens with Capital Gains?

[@EBackwards]

Let's say I've reached the TFSA limit of $95,000... Why should or shouldn't I take that $95,000 of investment and put it into my chequing account? Then, wait a full year and start putting money back into my TFSA? Alternatively, is it better to keep my TFSA $20,000 below the max limit? Once I reach, say, $65,000, start moving the tax-free money into a chequing account. My understanding is you don't pay tax on money in your chequing account if it doesn't earn interest. This way, I can keep adding money into an account and, if one day an investment grows significantly (though rare, it happens), I have room to put that extra money into my TFSA. This approach would allow me to continue investing in growth stocks or other investments. Could you do a video on any tips to (within legal bounds of the TFSA of course) "work" the system correctly?

[@colingoldthorpe5918]

But you don't pay taxes on the interest earned on your TFSA. If you take the interest and put it in your checking account it doesnt earn anything there. I keep my TFSA full all the time, any stocks you own the dividend just keeps re-enrolling in your TFSA. So if stocks in your TFSA are down in value, the divided is just buying a higher number of shares at a cheaper rate, once the market improves your shares are now worth more, and your TFSA amount is higher. I keep as little in my Checking account nowadays, because the bank is using your cash in that account to make money for themselves.

[@garth217]

​@colingoldthorpe5918 true, but my high interest savings account is doing just as good as my TFSA

[@EBackwards]

@@colingoldthorpe5918 the issue for me is if this. Taking your example, let's say you wanted to add 10k to your tfsa but your at max and happy with your current investments. But you did some research and the Peppermint Paddy Company is about to break out for massive gains. You want in on the action but you don't want to sell your current holdings. You also don't want to ise another account subject to tax on capital gains. So that's my consideration about leaving head room to react to an investment opportunity. Guess I'm looking for tips or another approach to when (be it the day...) I near max on my TFSA.

[@pjm3005]

this is the most cockamamie scheme I have heard today. What are you hoping to accomplish?

[@pjm3005]

@@garth217 then you're doing your TFSA wrong. It's more than a savings account bud. It's an INVESTMENT account.

[@KiaNgan-ni9ud]

I gave a very curious question. Lets say my spouse died abd I was the successor, when I die. Can I name my two kids as my successors?

[@chrismcinnis6605]

No

[@Gustagustapt]

What if you had a managed tfsa by robô advisor and transferes that monney to a self managed tfsa? Can you use the monney still?. Wealth simple sayd that was no problem.

[@raymondhoho]

Great video. Very clear. Thank you so much! :^)

[@ParallelWealth]

Glad it was helpful!

[@johnnylawson7055]

If I borrow money to put into my TSFA, can I write off the loan interest amount on my tax returns?

[@sharky6128]

Hi Adam , currently BCE shares are down by quite a bit. Is now a good time to move my BCE shares from a registered account to a TFSA? I have max room in my TFSA. Thanks 👍🍻

[@JDRichard]

2nd comment. We are pilling as much as we can into this account. CRA data is sometimes late so need to delay contribution until you are absolutely sore of the room you have.

[@DoneByD]

Although it is good CRA has information on your TFSA account which you can review through you online account, I don't rely on CRA to do my tracking for me. As you mentioned they always have a delay because information slips are not submitted until the following year sometime late Feb or into early March. I have my TFSA information at hand, in a spreadsheet, so I know exactly how much room I have available to me... The last few years we deposit our TFSA annual amount within the first two weeks of January so it's much easier to track for me than when we were putting bi-weekly deposits. Bi weekly deposits was a little more work but still very doable and no reason not to know how much room you have available.

[@user-dq4ri6fi7b]

track it yourself I know what I have contributed each year and you can google what you're allowed in total depending on when you turned 18

[@juantinoco8789]

Another mistake is making the TFSA account too risky, as you cannot recontribute losses you incur

[@zxu-zv2yy]

like your post, I like to hear your professional opinion on my scenario: I contributed the full amount per the contribution room from online data in my account, but next day, when I checked it again, that contribution room is 10000 less, So , i withdrew 10000 to prevent the penalty. I don't know why CRA web will provide me different contribute room in such short time. Would you please let me know what impact it would have to my account as per your explanation, there are regulations for over contribution, withdraw and penalty. Thank you in advance!

[@ParallelWealth]

We have seen something similar many times and they have always forgiven the honest mistake in the past. As long as you correct asap. That said, they can charge 1% per month over contribution.

[@zxu-zv2yy]

@@ParallelWealth Thank you so much for your quick response.

[@deltadeltaohmygod]

If the invested money from tfsa result in earnings, are all of these earnings tax free, or only up to a quota for that year?

[@cindymacpherson3248]

I actually did name a successor

[@fuelthefighter]

Great video

[@ParallelWealth]

Thanks!

[@georgemeek4351]

Very informative..

[@danielbernatchez3216]

does the dividend count in you max out annual deposit ?

[@sp90009]

Thanks Adam, good info as always. I can see how in 10-15 years timeframe, people will be able to accumulate 500k-1mil in their TFSA. Which may help qualify for GIS or other income tested benefits. What do you think are the chances that the government will change the TFSA rules down the road?

[@ParallelWealth]

Unlikely, but you never know! I think changing it for most would affect other government programs to some extent in a negative way.

[@brianxyz]

@@ParallelWealth I doubt this will ever be a big issue. Most people will not delay taking their CPP and/or company pension to get a bit of GIS even if it makes sense to do so for most people.

[@APICSKH]

GIS is for less fortunate, wish I never have to rely on GIS. I will happily give up GIS.

[@colingoldthorpe5918]

Maybe 6% interest since 2009 so compounded it could be around $130K total in a TFSA. But very unlikely it could be $500K.

[@kevinhesspschamp8889]

What are your guys interest profits so far not sure if I'm over 100k yet or not

[@surreyfool]

Hello Adam, I enjoy your videos. The examples you gave in this video were good, one extra scenario that would be beneficial for some would be explaining what happens if your TFSA account grew to $185 000 and you withdrew $120 000 of it in 2023, How much could you contribute Jan 1 2024? Sincere Thanks

[@ParallelWealth]

120k plus the new contribution limit for 2024 ($7k).

[@pjm3005]

127k

[@epictetus3406]

Great video! Could you clarify something please - If I maxed out the tfsa in 2021 and then withdrew 10k and deposited the same 10k back into the tfsa in 2021 I would have over contributed. Does that over contribution reset the following year? Meaning that CRA would only penalize me for the remaining months of 2021 that I had over contributed?

[@guyteresabukasa8816]

My financial advisor here in Québec told me that I don't need to name a successor holder. Is it true? He says that in Québec it's automatic.

[@ParallelWealth]

True in Quebec.

[@radiusnorth1675]

If you have the room, can you move stocks from an investment account "in-kind" to your TFSA?

[@michele7944]

You can do it but it’s best to wait till mid December. Remember, if you make a withdrawal from your TFSA in 2024, you would have to wait 2 weeks (2025) before you can put the equivalent stock (in kind) back into your TFSA.

[@roman88469]

Also, you should be aware of stocks you're buying. Here's an email I got from my broker: "...As you held or traded a U.S. publicly-traded partnership (PTP) during 2023 that is subject to withholding tax under IRS section 1446, you will have received a K-1 tax form by mail, between March 15-April 15, 2024. Form K-1 is an IRS tax document that is used to report each partner's share of the partnership's earnings, losses, deductions, and credits for U.S. limited partnerships. To confirm if you need to include form K-1 for tax filing with the IRS or how to use it, please consult with a tax advisor..."

[@letmedietomorrow]

What if you made gains in your TFSA and want to withdraw a portion of it? Would the withdrawal count as "gains" or "contribution room"? For example, you made 100k gains on your 95k contributions and want to withdraw 50k. Would you be able to contribute 50k back into the account next year?

[@michele7944]

Yes you can, plus the 2025 contribution.

[@kurtengel6029]

Thanks for the successor tip my bank never said anything about that, what savings account is giving you 4% ?

[@edbernie9675]

Motive financial

[@user-dq4ri6fi7b]

tangerine and eq currently are giving 5% for gic's and just a little less for short term gic's

[@tyleroliver5571]

What if you’re just starting? I’m in my 30’s but make a 6 digit wage. From 18 til now could have had 90,000$ so even though the 2024 is 7000$ could I still put in say 30,000$ in the year since I’m still under the 90 or did I screw myself waiting so long and can only put the 7000$ in?

[@ParallelWealth]

You can contribute unused room. So if you have $30k of room, then yes you can.

[@tyleroliver5571]

@@ParallelWealth you have no idea how many times I’ve asked this over the last year and no one would answer. I only put in the 7 over the last year just incase. But my car payments are done which is an extra 321 biweekly I’m going to use on top of what I invest til I catch up to my limits. So Thank you!

[@jordancarlin9687]

I don’t understand tax free savings . Why do savings get taxed ?

[@countbaker5595]

Tax-free means the interests you earned are not taxed.

[@jordancarlin9687]

@@countbaker5595 interest from what ?

[@alexlevac4848]

why not promote fhsa for a new video?

[@loffjr7013]

didnt talk about how many trades within the account would flag the government into taxing your gains as business income

[@ParallelWealth]

Because there is no clear direction from CRA on this.

[@loffjr7013]

@@ParallelWealth thanks for the response. appreciate it.

[@althunder4269]

4:57 you think we are going back to 1% interest rates? Not unless we have another major world crisis.

[@w3072]

can you open a tfsa for your kids with out them knowing

[@AA-co9oo]

No; they have to be 19 and over to have one. We opened regular accounts and mutual funds under ours but in their name.. once they are 19 we transferred everything to them..

[@Cormorant1011]

Forgot to mention the different types of TFSA. Daily interest and mutual TFSA.

[@ParallelWealth]

They are all the same TFSA, just different types of investments. But there is only one type of TFSA.

[@martinithechobit]

TY SIR!>

[@stevek6797]

You have mentioned foreign residention tax on dividends 15%. Is there any way to reclaim it?

[@ParallelWealth]

Nope

[@pjm3005]

@@ParallelWealth can't you hold US securities in your RRSP and avoid the 15% withholding tax

[@michaelg4232]

I'd you contribute the max. Can you withdraw profits or put profits back?

[@pjm3005]

yes. any withdrawls are added to contribution room in the next fiscal year.

[@michaelg4232]

@pjm3005 ok so the contribution amount is like 7k a year. You can withdraw as much profit as you want but ultimately you wont be able contribute more. Am I understanding correctly ?

[@pjm3005]

@@michaelg4232 i'm not sure if you are or not. say you rode shopify from $5 to $160 before you sold everything and your TFSA was at 600k. You could withdraw 500k this year, pay no taxes on it and be able to contribute 507k to your TFSA next year.

[@pjm3005]

assuming that contribution room for everyone in 2025 was set at 7k!

[@natewilliams2412]

and then when you invest your tfsa and the market crumbles you lose that amount in your tfsa permanently unless those stocks come back up.

[@nicholassalapoutis2829]

if you are saving for a home there is a tax free first time home buyers account

[@diggler64]

I guess I'm good then 😊

[@victoriamacpriest7130]

Thank you

[@KinnerSurprise]

When does the 1% penalty start when I overcontribute to a TFSA? For example, if I realized that I overcontribute by 10K in February but I withdraw 10K from TFSA in May then how much do I owe? $400 (4 months x 1%)?

[@user-dq4ri6fi7b]

FYI, I accidentally over-contributed one year (tangerine offered extra interest if I let the following year deposit sit for the months of Oct-Dec, I took them up on it but accidentally deposited the money to the tfsa account instead of the tangerine holding account). Anyway, I did get a hefty bill, I called CRA and they advised me to write a letter to explain and to ask for forgiveness (yes, forgiveness), I did this and they reversed the penalty.

[@UlyssesSean]

Lee Helen Lee John Garcia George

[@Udjeox]

I review my tfsa account 10 times in a day lol😅

[@xFrozenxSnowx]

#5 is gonna be an awkward conversation with your SO

[@lw1405]

One other thing- be careful what you invest in inside your TFSA. If you have a loss inside your TFSA and withdraw those funds you lose that contribution room forever. Example: you put $7000.00 into your TFSA in stocks and the market dropped and your investment is only worth $5000 now. If you withdraw that $5K you have lost that $2K of room forever.

[@pjm3005]

in this scenario, why would you withdraw the 5k from your TFSA?

[@byaran1]

How can I get my TFSA which is about $100k that sits in my account to do more?

[@kellypurdue1990]

I think investing in dividend paying etfs and have the dividends roll back into the tsfa account would be one way.