TFSA and contribution room

[krs]

Hello All,

I have a TFSA account and I started stocks -trading this year with my TFSA account. My allocated contribution room this year is 25K and I invested 20K which has now a value of 35K. If I sell my shares, I will get an amount of 35+K which is above the limit provided by CRA. Do I need to pay taxes on the amount greater than my TFSA limit? Can I have my hard earned money of 25K/contribution limit and trade while keeping all the profits tax free? if yes, what proof do I need to submit to CRA during the taxation period?

What does TFSA contribution limit in my NOA actually mean?

Thanks,
Krs
*Sorry a newbie for TFSA

 

[canuck78]

Hello All,

I have a TFSA account and I started stocks -trading this year with my TFSA account. My allocated contribution room this year is 25K and I invested 20K which has now a value of 35K. If I sell my shares, I will get an amount of 35+K which is above the limit provided by CRA. Do I need to pay taxes on the amount greater than my TFSA limit? Can I have my hard earned money of 25K/contribution limit and trade while keeping all the profits tax free? if yes, what proof do I need to submit to CRA during the taxation period?

What does TFSA contribution limit in my NOA actually mean?

Thanks,
Krs
*Sorry a newbie for TFSA

Would encourage you to read more online versus this forum. You are allowed to contribute a certain amount per year into your TFSA. The amount of money in your account because of growth or losses is not associated with your contribution limit. The money in a TFSA is tax sheltered so you will not need to pay capital gains on any gains.

 

[krs]

Would encourage you to read more online versus this forum. You are allowed to contribute a certain amount per year into your TFSA. The amount of money in your account because of growth or losses is not associated with your contribution limit. The money in a TFSA is tax sheltered so you will not need to pay capital gains on any gains.

Thank you. I did search online however there are always some bylaws. For example I got to know that.... if I buy USA company stocks and I get dividends, the dividends are yet taxable even if it's in TFSA.

Thanks,
Krs

 

[canuck78]

Thank you. I did search online however there are always some bylaws. For example I got to know that.... if I buy USA company stocks and I get dividends, the dividends are yet taxable even if it's in TFSA.

Thanks,
Krs

Yes there are lots of specifics so a forum is not a place to ask all the details.

 

[expert_law]

Hello,
Can anyone help me with this - I received an educational letter from CRA on TFSA over-contribution. As per the letter, I have exceeded the TFSA contribution for 2022 by $9,000. So far, they are not charging penalty for this over-contribution. When I checked my CRA account it showed me that my contribution as of 1 Jan 2023 is only $2,500 (I guess this is due to the fact that a contribution room of $6,500 was added on 1st Jan 2023).

In this scenario, I have 2 questions:
a) What amount do I need to take out from my TFSA ($9,000 or $2,500) ?
b) How much time I have to withdraw the money (received the letter from CRA on 18th June 2023)? The money in TFSA is in form of Non-redeemable GIC and it is set to mature end of July'2023.

Thank you