TFSA Contribution Limit for 2022

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What is a Tax-Free Savings Account (TFSA)? ​

The Tax Free Savings Account (TFSA) is an investment program for individuals to set aside tax-free money over their lifetime.  Individuals must be 18 years of age or older and have a valid Social Insurance Number (SIN). 


TFSA contributions are not income tax deductible. Money contributed along with any income earned in the TFSA account is generally tax-free, even when it is withdrawn. Qualified investments include cash, guaranteed investment certificates (GIC), government and corporate bonds, mutual funds, and securities listed on a designated stock exchange. Qualifying investments for a TFSA are similar to those that qualify for an registered retirement savings plan (RRSP). 


Fees in a TFSA (administrative or other) and any interest on borrowed money for a contribution to a TFSA are not tax-deductible as the money you invest has already been taxed. You do not need to have earned income to contribute to a TFSA. 


Table of Contents

When Is the TFSA Contribution Deadline for the Year 2022?

  1. There are no deadlines.  If you don’t contribute, the contribution room will be carried to future years. 

How is the Limit Determined?

A specific maximum amount can be put into a TFSA account each year. The maximum amount that you can contribute to your TFSA is limited by your TFSA contribution room. Changes in the value of your TFSA and investment income earned will not affect your TFSA contribution room for current or future years.  


If you were 18 or older in 2009, your TFSA contribution room grows each year even if you do not file an income tax and benefit return or open a TFSA.  If you turned 18 after 2009, your TFSA contribution room starts in the year you turned 18 and your TFSA contribution room accumulates every year after that year. 


Annual TFSA Dollar Limit

The annual TFSA dollar limit for each of the years from 2009 to 2023 are: 

2009 to 2012 $  5,000
2013 and 2014 $  5,500
2015 $10,000
2016 to 2018 $  5,500
2019 to 2022 $  6,000
2023 $  6,500

What is my TFSA Lifetime Limit

The maximum overall money you can deposit in your TFSA is cumulative. If you are contributing in 2023 for the first time, to catch up, you are eligible to deposit $88,000 in total contributions, provided you were over 18 years of age since 2009 and have a valid SIN (social insurance number). Unused TFSA contribution room rolls over from one year into the following year.


What if You Contribute More Than Your TFSA Room?

Generally, you have to pay a tax of 1 percent per month on your contributions that exceed your TFSA deduction limit by more than $2,000.  Your excess contributions must be reported to the Canada Revenue Agency (CRA) within 90 days after the last day of the tax year when you over-contributed. Reports filed after that deadline may be subject to an additional penalty equal to 5 percent of the taxes you owe plus an extra 1 percent for every month, to a maximum of 12 months. 


Common Issue – Withdrawing from TFSA account

You can withdraw funds from TFSA any time you want, but one thing that you need to be mindful of is when you “redeposit the funds”.   You cannot redeposit it back in the same year, as CRA wants to discourage individuals to use TFSA like a chequing account.  Once you withdraw the funds, the “contribution room” will not be available until NEXT year.  For example, in March 2022, Jenny used up her TFSA contribution room available.  If she withdraws $5,000 in July 2022, she cannot deposit the funds back in October 2022.  She needs to wait until January 1 2023.  Otherwise, there will be penalties and interest on the overcontribution. 



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