# What will the 2014 TFSA limit be? Anyone from CRA here?



## the-royal-mail (Dec 11, 2009)

CRA's website has still not been updated and is not clear about the 2014 TFSA limit:

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/tfsa-celi/cntrbtn-eng.html

_"The TFSA contribution room is made up of:
•your TFSA dollar limit ($5,000 per year plus indexation, if applicable)"_

I know it was $5500 in 2013 and $5000 in 2012 but I believe official inflation is "lower" this year.

And logging in to my web account does not help because I usually max out on Jan 2 every year and I do not want to wait until they update their database 3-4 months from now to find out for sure.

Does anyone know for sure (please do not speculate) what the TFSA limit for 2014 will be?


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## Jon_Snow (May 20, 2009)

5500


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## pwm (Jan 19, 2012)

I doesn't ratchet down. It only increases by $500 increments based on inflation. It will be $5,500 this year.


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## pwm (Jan 19, 2012)

This is from the CRA Website:

_The annual TFSA dollar limit increased to $5,500 on January 1, 2013, for the 2013 contribution year, and remains at that amount for the 2014 contribution year._


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## My Own Advisor (Sep 24, 2012)

Dang


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## the-royal-mail (Dec 11, 2009)

pwm, can you supply a link to where you found that passage on CRA's site?


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## MoneyGal (Apr 24, 2009)

the-royal-mail said:


> pwm, can you supply a link to where you found that passage on CRA's site?


http://news.gc.ca/web/article-en.do?nid=791099

The contribution limit is not set by CRA, but by Finance.


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## P_I (Dec 2, 2011)

How about 2014 indexation adjustment for personal income tax, benefit amounts, and the annual dollar limit for Tax-Free Savings Accounts (TFSAs)? Doesn't exactly match pwm's quote, but it does come from CRA.


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## pwm (Jan 19, 2012)

Look at "What's new for this tax-filing season?":

http://www.cra-arc.gc.ca/nwsrm/txtps/2013/tt131209-eng.html?rss


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## 6811 (Jan 1, 2013)

the-royal-mail said:


> pwm, can you supply a link to where you found that passage on CRA's site?


This isn't pwm's link, but using the info from the CRA site (quoted below) it calculates to $5500 for 2014. 

TFSA dollar limit for 2013 http://www.cra-arc.gc.ca/tx/rgstrd/tfsa-celi/bt-eng.html

In 2009 and subsequent years through 2012, the TFSA dollar limit was $5,000 per year. When the 2013 indexation increase of 2% is applied to the cumulatively indexed (since 2010) TFSA dollar limit and the result is rounded to the nearest $500, the TFSA dollar limit for 2013 increases to $5,500.


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## MoneyGal (Apr 24, 2009)

(how did those of you who didn't know this...not know it?!)


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## the-royal-mail (Dec 11, 2009)

Thanks pwm! $5500 it is!


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## P_I (Dec 2, 2011)

The information is also maintained and updated at Tax-Free Savings Account - finiki, the Canadian financial wiki


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## Siwash (Sep 1, 2013)

I hope the TFSA will continue… I hear that the Feds could one day scale it back or remove it


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## Jon_Snow (May 20, 2009)

Another 11k of tax sheltered investments almost here... I realize its pretty geeky to be excited about this.... but I am. :biggrin:


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## thompsg4416 (Aug 18, 2010)

Seems like nothing but a break for the more well off I.E for those of us with money to actually use it. Apparently only about 1/3 of Canadians actually have a TFSA.. 

Anyway - I'm not sure how great it is for the Canadian economy or the federal budget but I'm not complaining(at least not too loudly).


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## Canadian (Sep 19, 2013)

I could see scaling back the TFSA one day - imagine in 15 years having over $100k available in contribution room - I can't see the feds / CRA allowing that much money going completely tax sheltered [would be nice though]. I don't think we will see it completely removed. Given the small % of Canadians who actually contribute to / invest in TFSAs, they are not missing out on a ton of tax revenue. It would be a PR nightmare.


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## yyz (Aug 11, 2013)

You seem to forget they also took away the interest trusts and withstood that pr nightmare.I could see a lifetime contribution limit someday coming into play.


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## Nemo2 (Mar 1, 2012)

And don't forget this:

http://www.cbc.ca/news/business/a-primer-on-capital-gains-taxes-in-canada-1.231145




> Wasn't there a capital gains exemption for a while?
> 
> Yes, there was. In 1985, the government introduced a capital gains exemption, where each Canadian did not have to pay any tax on capital gains up to a lifetime maximum of $100,000.
> 
> But the government decided to abolish the exemption as of February 22, 1994.


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## Eclectic12 (Oct 20, 2010)

^^^^

You can add in that capital gains came into effect for Canada in 1972 ...

http://www.canadafaq.ca/what+is+capital+gain+tax+in+canada/


... or that "temporary" income tax introduced in 1917 ...


Cheers


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## Canadian (Sep 19, 2013)

I'm not saying the PR nightmare will ruin them or stop them from doing it. each:

The consequences of removing the TFSA completely doesn't really benefit anyone immensely. Though, not to say it's significantly different from the the abolishments above.


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## Jon_Snow (May 20, 2009)

Have 36k in my HISA, so our 11k is ready to go for our our 2014 contributions - and will leave 25k in our HISA, the amount needed to waive all transaction fees. Love it when a plan comes together. :biggrin:

Who else is ready to max out their respective TFSA's?


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## Nemo2 (Mar 1, 2012)

Jon_Snow said:


> Who else is ready to max out their respective TFSA's?


"Please sir, me sir"


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## wendi1 (Oct 2, 2013)

We do this every year, even though we have some RRSP contribution room left.

January for my hubby, sometime after I get my tax refund for me.


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## the-royal-mail (Dec 11, 2009)

I will be ready to do the 2014 deposit on about Jan. 10. I missed my 2013 savings target by 10 days.


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## Synergy (Mar 18, 2013)

Topped up my TFSA today - 2014 contribution - $5500. Now I just need to figure out what to buy. Currently holding a few REITs (REI, NPR, HR, CUF, D), 1 Income Trusts (BPF), and TDB8150. 2 options I've considered - 1) top of a few of the REIT's to ensure I can DRIP a full share and add some to my TDB8150 OR, 2) Find a good growth stock - had intentions on purchasing ACQ a while back but with the run up in this stock I'm concerned what could happen if the market undergoes a 10-15% correction in 2014 or the auto industry starts to stall. My RRSP is reserved for index funds / ETF and I hold CDN dividend payers in my Non-Reg account. WHAT ARE YOU BUYING / CONSIDERING FOR YOUR TFSA's??


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## Nemo2 (Mar 1, 2012)

Synergy said:


> Topped up my TFSA today - 2014 contribution - $5500. ...... WHAT ARE YOU BUYING / CONSIDERING FOR YOUR TFSA's??


Transferred $5,500 into each of our TFSAs this a.m..........since we consider ours as part our fixed income allotment we'll probably buy 4 year GICs @ 2.42% with Equitable through TDWH tomorrow.


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## Spudd (Oct 11, 2011)

The $5500 didn't cause any of my allocations to go out of tolerance, so I'm just going to hold it in cash until any of them need rebalancing.


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## Jon_Snow (May 20, 2009)

11k into our respective TFSA's a few minutes ago. I like REIT's in these accounts - will do some research today and probably start buying a few things during the week ahead.


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## Nemo2 (Mar 1, 2012)

Nemo2 said:


> we'll probably buy 4 year GICs @ 2.42% with Equitable through TDWH tomorrow.


Make that 5 year with Equitable @ 2.76%


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## Toronto.gal (Jan 8, 2010)

I will be transferring a stock from non-reg acct. to TFSA. Minimal capital gains as stock was purchased in Q3-2013 [but expect considerable upside potential].


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## Retired Peasant (Apr 22, 2013)

I think I'll withdraw from RRSP and put in TFSA. I have non-reg acct, but it generates dividends and current tax bracket means 0 tax paid on the divs (would also trigger cap gains if I transfer to TFSA). The withdrawal from RRSP will result in little tax owing due the bracket.


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## Canadian (Sep 19, 2013)

Retired Peasant said:


> I think I'll withdraw from RRSP and put in TFSA.


A word of caution [you may already know this]: withdrawals from RRSP result in a permanent loss of contribution room. It is not like the TFSA where the limit resets in the new year.


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## avrex (Nov 14, 2010)

@T.gal, remember this nice bit of advice that Eclectic12 told us in another thread...



Eclectic12 said:


> Also - when I asked about the process for the stock transfer to TFSA, I was informed that I would be allowed to select the price of the Deemed Disposition, based on the range the stock traded, the day the transfer occurred.
> 
> So I watched the stock for a while and waited for a day when the stock was down. I then called in after 2pm and picked the lowest price traded. This way the Capital Gain was lower.


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## Toronto.gal (Jan 8, 2010)

^ Thanks so much for reminding me Avrex! With that in mind, I might not even transfer today.


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## Retired Peasant (Apr 22, 2013)

Canadian said:


> A word of caution [you may already know this]: withdrawals from RRSP result in a permanent loss of contribution room. It is not like the TFSA where the limit resets in the new year.


Yes I know; I plan on never contributing to RRSP again.


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## avrex (Nov 14, 2010)

Just a quick side note about TFSAs....

We've had many posts of people being upset with service (USD dividends, etc.) at TDDI (TD Direct Investing).
Here's my positive spin with TD and the TFSA.

Jan 01. Transfer $5500 from TD Bank account to TDDI TFSA account.
Jan 02. Perform Norbert's Gambit to convert $5500 CDN to USD.

*Quick. Done. *

Currency Conversion fee: *$20*

Can you get *USD into your TFSA* that cheaply at your bank? :wink:

After settlement (T+3), I can purchase any USD investments that I please (ETFs, stocks, etc.)

Just saying.... TDDI ain't that bad.


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## humble_pie (Jun 7, 2009)

a gambit trade is an arbitrage trade that converts capital from CAD to USD, or vice versa, at lovely spot rates. Rates normally attainable only via giant institutional currency trades at the world's leading money centre banks. Retail gambit traders like ourselves are piggybacking on the arbs.

truly, a gambit trade has nothing to do with concealed broker FX fees on dividends.


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## humble_pie (Jun 7, 2009)

another little note about the TD: ya'll did catch how the early-2013-pushed-back-to-early-4014 dual currency USD RRSP has now been pushed back one more time, to 2015?

this is suggesting to me that the big green has decided to shop for another mainframe. Which means everything gets reset to square one. Two years of labour on ISM have gone down the drain. Go back to home & start again.


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## Synergy (Mar 18, 2013)

avrex said:


> @T.gal, remember this nice bit of advice that Eclectic12 told us in another thread...





> Originally Posted by Eclectic12 View Post
> Also - when I asked about the process for the stock transfer to TFSA, I was informed that I would be allowed to select the price of the Deemed Disposition, based on the range the stock traded, the day the transfer occurred.
> 
> So I watched the stock for a while and waited for a day when the stock was down. I then called in after 2pm and picked the lowest price traded. This way the Capital Gain was lower.


Great point, I did this last year with one of my REITs - secondary to advice that was provide to me by one of the TDW reps.


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## Sherlock (Apr 18, 2010)

thompsg4416 said:


> Seems like nothing but a break for the more well off I.E for those of us with money to actually use it. Apparently only about 1/3 of Canadians actually have a TFSA..
> 
> Anyway - I'm not sure how great it is for the Canadian economy or the federal budget but I'm not complaining(at least not too loudly).


I'm certainly not well off yet I have been managing to max out the TFSA every year. I think it's the middle class and lower-middle class who will benefit from this the most, because to the wealthy (eg the multi-millionaires) a measly $5500 a year is nothing.


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## Sherlock (Apr 18, 2010)

Guys, what do you think about trying to time the market with my $5500 contribution? The word aroudn the water cooler is that although 2014 will finish higher, there should be a market pullback sometime in the spring. This would be ideal as it would allow me to use my tax refund from my rrsp contribution for my tfsa contribution. Or am I a fool for thinking that I'm smart enough to time the market successfully?


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## richard (Jun 20, 2013)

Sherlock said:


> Guys, what do you think about trying to time the market with my $5500 contribution? The word aroudn the water cooler is that although 2014 will finish higher, there should be a market pullback sometime in the spring. This would be ideal as it would allow me to use my tax refund from my rrsp contribution for my tfsa contribution. Or am I a fool for thinking that I'm smart enough to time the market successfully?


Quick math test... this isn't a prediction, just one possible scenario that is not uncommon: if the market rises 10% in the first few months, then has a 5% pullback in spring, and then rises another 10% from there to the end of the year, and you bought at the lowest point in the pullback, did you come out ahead?


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## richard (Jun 20, 2013)

the-royal-mail said:


> _"The TFSA contribution room is made up of:
> •your TFSA dollar limit ($5,000 per year plus indexation, if applicable)"_
> 
> I know it was $5500 in 2013 and $5000 in 2012 but I believe official inflation is "lower" this year.


Lower inflation is not a danger. Even if inflation was only 0.01%, that still means prices were higher than last year and we're pushing towards a higher TFSA contribution (might be a while before we get that next $500). You're thinking of deflation. I don't know what would happen to the TFSAs in that case but since it would be a second Great Depression anyways we probably wouldn't be thinking about TFSAs that much.


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## the-royal-mail (Dec 11, 2009)

I just completed the tx last night, so the TFSA balance should update shortly to reflect the $5500 I added. Anyone else besides Sherlock delaying their tx a bit this year or has everyone here maxed out already?


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## NorthKC (Apr 1, 2013)

Catching up on all the contribution room this year. I seriously doubt I will max out but it's one step closer!


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## andrewf (Mar 1, 2010)

If Canada experiences enough deflation to bump TFSA contribution limits back down to $5k, we have much bigger problems.

With the declining CAD, my TFSA is now up to about $53k.


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## avrex (Nov 14, 2010)

@andrewf. Is your TFSA mostly USD? 

If so, you got a nice 6% increase in 2013 just from CAD/USD.


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## HaroldCrump (Jun 10, 2009)

andrewf said:


> If Canada experiences enough deflation to bump TFSA contribution limits back down to $5k, we have much bigger problems.


It's the same metric that is used to index OAS, GIS, CPP, etc. right?
If so, it won't happen.
The Canadian govt. would much rather print and throw dollars into the Atlantic from the HMS Halifax instead.


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## andrewf (Mar 1, 2010)

Avrex, 100% USD denominated, except the contribution last week.

Harold,

Printing then destroying the money would have no net impact.

If they gave it to people to spend, then you'd see some effect on inflation.


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## avrex (Nov 14, 2010)

I am also 100% USD in my TFSA.


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## HaroldCrump (Jun 10, 2009)

andrewf said:


> Harold,
> Printing then destroying the money would have no net impact.


I didn't mean it literally, of course.
I meant if the TFSA indexation is based on the same metric as the social security and pensions, then it will never be reset backwards.
In these cases, politics will always win, economics be damned.


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## Canadian (Sep 19, 2013)

It will be another couple of years until my TFSA is maxed out. I contribute to it frequently, though.


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## andrewf (Mar 1, 2010)

HaroldCrump said:


> I didn't mean it literally, of course.
> I meant if the TFSA indexation is based on the same metric as the social security and pensions, then it will never be reset backwards.
> In these cases, politics will always win, economics be damned.


Good reason not to allow deflation, no?


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