How to contribute to a TFSA
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When to make a contribution
If you have available contribution room and are a resident of Canada, you may contribute funds to your Tax-free Savings Account (TFSA) at any time during the calendar year.
Make sure you have available room
Your available contribution room applies across all your TFSAs. And it can change when you make withdrawals and contributions. Always calculate your available contribution room before you contribute.
For more information: Calculate your room before you contribute
If you become a non-resident, do not contribute to your TFSA.
For more information: Do not contribute if you are a non-resident
How to make a contribution
To contribute funds to your TFSA, you must go through the financial institution that issued it. Contact your issuer or consult their website to find out what options are available.
You can contribute to your TFSA at any time, as long as you have available contribution room.
The amount that you contribute will immediately be applied against your available contribution room, reducing it by the same amount you contributed. This is not immediately updated in your CRA account.
How to avoid an over-contribution
Do not contribute more than your available contribution room allows. If you over-contribute, the excess amount is taxable at a rate of 1% per month for as long as the excess amount remains in the account.
For more information: If you over-contribute to a TFSA
Track your contribution room yourself
We recommend calculating your available contribution room yourself using your own records. Your financial institution and the CRA may not necessarily have your complete TFSA information.
For more information: Calculate your room before you contribute
Do not replace a withdrawal in the same year
Never re-contribute all or part of a withdrawal in the same calendar year that you made the withdrawal unless you know that you have enough unused contribution room available.
Withdrawals you make from your TFSA will only create new available contribution room in your account the next calendar year.
Example: How replacing a withdrawal in the same year can lead to over-contribution
On January 1, 2025, Taylor’s available TFSA contribution room for the year is $7,000 (the dollar limit for 2025).
On January 10, 2025, she contributes $4,000. This contribution is immediately applied against her available room, reducing it to $3,000.
On February 10, 2025, she withdraws $4,000. Her contribution room stays at $3,000. (The $4,000 will be added back as available contribution room next year.)
On October 2, 2025, she re-contributes $3,500 as she wants to replace some of the withdrawal she made in February. However, this is a mistake as she does not have available contribution room.
If Taylor had calculated her available contribution room, she would have known she was only allowed to contribute up to $3,000. As a result, she over-contributed to her TFSA by $500.
To replace the full amount of her withdrawal, Taylor should have waited until January 1, 2026, when she would regain the $4,000 of available room from her withdrawal, as well as the TFSA dollar limit for 2026.
Investment losses do not create contribution room
Changes in the value of your TFSA investments do not affect your TFSA contribution room.
If your TFSA contains an investment that loses value, the loss does not count as a withdrawal and it is never added back as available contribution room.
Example: Do not replace an investment loss
At the beginning of 2025, Sam’s available TFSA contribution room is $6,500.
During the year, he makes the following transactions:
- On January 10, 2025, he contributes $6,500 (investing the funds in ABC stock)
- Over the year, ABC stock loses value
- On Dec 29, 2025, his investment is now worth $3,500
- On Dec 31, 2025, he contributes $3,000 to bring his balance back up to $6,500
Unfortunately, Sam does not realize this contribution is a mistake. An investment loss does not create contribution room.
Sam’s contributions for the year add up as follows:
Because Sam’s available room for the year was $6,500, he over-contributed by $3,000.
Do not over-contribute to multiple TFSAs
If you have multiple TFSAs, your available contribution room applies to all of them combined. To avoid over-contributing, be sure to track your transactions for all your accounts before making a contribution.
For more information: Calculate your room before you contribute
Example: Do not over-contribute to multiple accounts
Isla, an 18-year-old resident of Canada, opens her first TFSA in February 2022 with Rose Bank.
Isla’s contribution room for 2022 is $6,000 (the 2022 dollar limit). She contributes $6,000 to this TFSA.
In September of the same year, Isla opens a second TFSA with Tropical Bank and contributes $6,000 to this TFSA.
Her contributions for that year add up as follows:
Since her available contribution room for all her TFSAs combined in 2022 is $6,000, Isla over-contributed. She will have to pay tax on the over-contribution for each month the account was in excess (September to December 2022).
Now Isla keeps records of her contributions for all of her TFSAs and makes sure the total is within her available contribution room.
Do direct transfers through your TFSA issuer
To avoid tax consequences when transferring funds from one TFSA to another, always do a direct transfer through the receiving financial institution. If you withdraw your own funds and re-contribute them to another TFSA, you may over-contribute by mistake.
For more information: Avoid doing your own transfers
Option to give to your spouse or common-law partner
The total contribution you make to your own TFSA cannot be more than your available contribution room. If you have additional funds that you would like to invest tax-free, you may gift your spouse or common-law partner money so that they can contribute to their own TFSA. This amount or any income earned from this amount will not be allocated back to you.
The total contribution that your spouse or common-law partner makes cannot be more than their available contribution room.