# TFSA overcontribution ?



## Franky Jr (Oct 5, 2009)

So last year my notice of assessment showed a TFSA avail limit for 2011 of $15,xxx. I was surprised to see it that high. I had calculated it personally to be less. So I went with the government's #'s and maxed it out last year.
I haven't got any letters yet this year but I am concerned about a major overcontribution. I looked at my TFSA room for 2012 on the CRA website and it shows that I went over last year by nearly 5K and that my TFSA contribution room at the start of 2011 was $10,xxx. (clearly different than the notice of assessment that I have in my filing cabinet)
Do I have a fighting chance since the notice of assessment that they sent me shows a limit of $15xxx, which I honoured?

TKS


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## JustAGuy (Feb 5, 2012)

There's a chance. But here's some more information. http://www.moneysmartsblog.com/tfsa-over-contribution-penalty-fix/


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## iherald (Apr 18, 2009)

I had this same problem. Two years in a row they stated I had $5000 more in contribution room than I thought. I figured after two years of telling me I had more room than I thought, I added more. About 6 months later they reassessed and said that I put in too much. Thankfully I had no penalty.


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## DanFo (Apr 9, 2011)

The institutions are slow at sending in the data to the CRA. My assessments have yet to be accurate once, this is why it is critical to keep track for yourself. Good luck trying to fight penalties, I think the grace periods are over now


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## Eclectic12 (Oct 20, 2010)

DanFo said:


> The institutions are slow at sending in the data to the CRA. My assessments have yet to be accurate once, this is why it is critical to keep track for yourself.
> 
> Good luck trying to fight penalties, I think the grace periods are over now


I'm not easily finding the article I read earlier in the year but the gist of it was that where CRA had waived the penalty over the past couple of years due to the TFSA being new, they were going to be tougher on over-contributions this year.

As the penalty is 1% of the excess amount *per month* (and can be higher if they deem you are intentionally trying to beat them out of taxes), I'd recommend calculating any over-contributions and dealing with it asap.

At worst case, if you still have to pay the penalty - you've at least capped what the penalty will be. It may also help in that you can identify that the over-contribution was dealt with quickly.


Cheers


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## Four Pillars (Apr 5, 2009)

The TFSA "amnesty" was for people who didn't realize that you couldn't recontribute withdrawn money in the same calendar year. 

This is a different issue altogether.

I haven't looked at my CRA page, but I would hope that they put some kind of message saying that the contribution room listed is not up to date. 

If you do get a penalty, I would show them a screenprint or copy of the assessment on which you based your contributions and see if they let you off the hook.

I should probably write a post explaining the whole timing/reporting process.


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