Your TFSA loss can PERMANENTLY EAT your Contribution Room. Wait… what? 😳 If you put $7,000 into your TFSA and your investment falls to $3,500, that $3,500 contribution is GONE. So if you’ve used-up your room, you can’t simply deposit another $3,500 to “top it back up.” And yes… OVERCONTRIBUTING can trigger a 1% TAX PER MONTH on the excess amount. Did you know a bad investment inside your TFSA could have this consequence? 👇
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12 Comments
Bradley @bradleytalksmoney · 1d
This is the wrong way of thinking about it. The contribution room doesn't go away when the investment drops, it goes away when the contribution is made. If you contribute money then lose it, you simply have nothing to pull out, but the contribution was gone the second the money entered the account.
Gerald @aetos · 1d
This post has too many things wrong with it.
Matt Gray@matt.41 · 1d
The $3500 is only gone if you sell the investments but yes you should be conscious of what you invest in. No the contribution room isn’t gone forever, future withdrawals replenish your available contribution room.
Clantosa @clantosa · 1d
Too many people destroy their precious accounts with risky picks. These are the most treasured gifts we've been given. People should treat it as such. Keep risky individual bets in a non registered. At least you can tax harvest any losses
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