Why the TFSA room in your CRA account may be months out of date

Every January, a fresh slice of tax-free room is added to one of the most flexible accounts available to Canadian households, and every spring the CRA publishes a figure that is already a year behind. The gap between those two facts explains most TFSA mistakes. The rules themselves are short; it is the timing of the paperwork that trips people up.

$7,000 again in 2026

The TFSA annual dollar limit is $7,000 for 2026, unchanged from 2024 and 2025. The limit is indexed to inflation and rounded to the nearest $500, which is why it moves in steps rather than every year. Room begins to accumulate in the year you turn 18, as long as you are a resident of Canada, and it accumulates whether or not you have opened an account.

Added together, the limits since the programme began in 2009 come to $109,000 for someone who was 18 or older in 2009 and has been resident ever since: $5,000 a year for 2009 to 2012, $5,500 for 2013 and 2014, $10,000 for 2015, $5,500 for 2016 to 2018, $6,000 for 2019 to 2022, $6,500 for 2023 and $7,000 for 2024 to 2026. Someone who turned 18 later simply starts counting from that year.

How your room is actually calculated

Your contribution room on 1 January of any year is the sum of three things: the room you had left at the end of the previous year, the new annual limit, and any amount you withdrew during the previous year. Withdrawals are not lost; they are restored on the following 1 January. Contributions reduce room immediately, and that applies across all your TFSAs together if you hold more than one.

The restoration rule has a trap. If you withdraw $5,000 in March and put it back in October of the same year, the October deposit is a new contribution against this year's room, not a reversal. Unless you had $5,000 of room spare, you have over-contributed.

Illustrative. Based on the CRA's published annual limits for 2009 to 2026 and the rule that withdrawals are added back on 1 January of the following year. Non-resident years and any excess amounts would change the figures.

Why the CRA's figure lags

Financial institutions report a year's TFSA transactions to the CRA only by the end of February of the following year, and the CRA then updates the TFSA information in your account once a year, in the spring. The CRA itself said records from 2025 were expected to be processed by April 2026. So the number you see online in January reflects the position at the end of the year before last, and anything you contributed since is missing.

The CRA's advice is to use your own records, and to check them against your financial institution's statements, rather than treating the online figure as a live balance. A simple running tally of contributions and withdrawals by year is enough.

The figure in your CRA account is a snapshot of last year, not a balance you can spend against today.

One per cent a month on the excess

Any amount above your room is an excess TFSA amount, taxed at 1 % per month on the highest excess in the account during each month it remains. Withdrawing part of it mid-month does not reduce that month's charge, because the tax is based on the peak. The CRA's instruction is to withdraw the excess as soon as you notice it, not to wait for a letter; a TFSA return then has to be filed to report the excess for the year, even after it has been removed. Deliberate over-contributions can attract further tax.

What a TFSA can hold

Despite the word "savings", a TFSA is a tax wrapper rather than a type of deposit. It can hold cash, guaranteed investment certificates, mutual funds, bonds, securities listed on a designated stock exchange and certain small business shares. Interest, dividends and capital gains inside the account are not taxed, and withdrawals are not income, so they do not affect income-tested benefits. Deposits and GICs held in a TFSA at a member institution are insured separately by the CDIC, as explained in our guide to the $100,000 limit; mutual funds and stocks are not. Which holding suits you is a question for your own circumstances, not for this article.

Moving abroad, and what happens on death

If you become a non-resident of Canada you can keep the account and withdraw from it without Canadian tax, but no new room accrues for any year you are non-resident throughout, and withdrawals are not restored until you return. Contributions made while non-resident are taxed at 1 % per month until withdrawn, on top of any excess tax.

On the holder's death, the distinction between a successor holder and a designated beneficiary matters. A successor holder, who must be a spouse or common-law partner, takes over the account as its new owner on the date of death; the account continues tax-free and does not use any of the survivor's own room. A designated beneficiary instead receives the value at the date of death tax-free, but growth after that date is taxable, and the money only goes back into a TFSA if the beneficiary has room. Quebec does not recognize a successor holder designation on the TFSA contract itself; there it has to be handled through the will.

Good to know

Unlike an RRSP, a TFSA contribution is not deductible and there is no 60-day grace period: room is by calendar year. First-time buyers have a third account, the FHSA, with its own $8,000 annual limit.

Who this matters for, and what to check

• Anyone who has never opened a TFSA: your room is the sum of the limits since the year you turned 18 (or since 2009), up to $109,000.
• Anyone who withdrew in 2026: that amount comes back on 1 January 2027, not before.
• Anyone relying on the CRA figure: note the date it was last updated and add your own contributions since.
• Anyone with accounts at two or more institutions: one limit covers all of them, so keep a combined tally.
• Couples: check whether the account names a successor holder rather than only a beneficiary, except in Quebec, where the will governs.

The takeaway

The 2026 limit is $7,000 and the cumulative total since 2009 is $109,000. Room is calendar-based, withdrawals are restored only on the following 1 January, and an excess costs 1 % a month until removed. Because the CRA's online figure is updated once a year from reports that arrive in February, your own ledger is the one to trust. Keep it, compare it with your institution's statements, and the account does the rest.