How TFSA Contribution Room Works

Every Canadian resident aged 18 or older accumulates TFSA contribution room each year. The annual limit is set by the CRA and has ranged from $5,000 (in 2009) to $7,000 (in 2024–2026). Your total room is the sum of every year's limit since you became eligible, minus what you've already contributed, plus any withdrawals from previous years.

Withdrawals from your TFSA are added back to your contribution room — but not until the following calendar year. If you withdraw $5,000 in November 2025, that room becomes available again on January 1, 2026. This is one of the most misunderstood TFSA rules and a common cause of over-contributions.

Over-contributing to your TFSA triggers a 1% per month penalty on the excess amount. The CRA tracks your room automatically through your tax filings and T4 slips from your financial institution, but their "My Account" portal can sometimes lag behind. This calculator uses the same formula to give you an instant estimate.

If you turned 18 before 2009 and were a Canadian resident, your room starts accumulating from 2009 (when the TFSA was introduced). If you turned 18 after 2009 or became a resident after 2009, your room starts from whichever came later.