2019 annual TFSA limit set at $6,000.00 | Page 3 | Tax Free Savings Accounts | Discussion forum

And for this "service", they charge us in most cases for doing the transfer!

It makes sense that transfers would not be reported, since, really, they are of no consequence to CRA. They have no reason to care where your money is once it's been contributed unless it is actually withdrawn or put in an 'unqualified" investment.
This does imply, though, that they are somehow watching what we do. How else would they know if we used an unqualified investment? We know that they have in the past come down on people who were deemed to be trading too frequently, for example.

For those who would like to keep on top of this issue who might not know where to start, if you go into "My Account" on the CRA site and follow the links to TFSA and then TFSA transactions, you can pull up a display of all of your contributions and withdrawals since TFSAs were invented as reported to CRA by all of your FIs. You can then print that info either to PDF or hard copy as a record of your history to compare to your own records and smoke out any discrepancies

Alexandre said
Just remember: TFSA contribution info on CRA site is notoriously behind what you've actually contributed, sometimes for more than 1/2 year.  

True story, and even worse in my own case -- I recently rediscovered a small redeposit from Jan 18, 2018 that as of this morning still does not appear on my CRA record almost 11 months later.

Unfortunately I didn't catch that it was missing from the CRA record and I took their figure as correct when I topped up my accounts a few weeks ago, so for now I'm technically offside and subject to the penalty until my new $6K 2019 eligibility kicks in and clears up the problem.

The penalty will only be about $105-110 but I'm glad I caught it, because now I know I need to leave a few bucks loose in the account and not have everything in GICs -- having to try to bust a GIC just to pay off a small penalty would really blow

Londonguy said
…
The penalty will only be about $11-12 but I'm glad I caught it, because now I know I need to leave a few bucks loose in the account and not have everything in GICs -- having to try to bust a GIC just to pay off a small penalty would really blow  

There's no need to do that. The 1% per month penalty on TFSA overcontributions is not charged against the TFSA accounts. The penalty is charged separately.

One needs to send CRA a completed Form RC243 (TFSA Return) with a cheque for the penalty by June 30.

Having some TFSA cash readily accessible is prudent. If you make a contribution mistake early in the year, you can withdraw it and save some of the penalty. Unfortunately, they charge you for each month based on any day of over contribution in a given month, so taking the money out in December won't help.

Sorry for your loss.

Londonguy said

The good news is that I didn't go over until the end of November, so the penalty will only apply to the 2 months (Nov & Dec) I was offside, and only on the small transfer amount that I missed. I have since built myself an idiotproofing spreadsheet to eliminate any recurrences -- it cost me just a bit over $100 to produce LOL  

There is a possibility to get a waiver on the 1% tax. This is on the back of the RC243 form:

Waiver of TFSA taxes

We may waive or cancel all or part of the taxes if we determine it is fair to do so after reviewing all factors, including whether:

• the tax arose because of a reasonable error
• the extent to which the transaction or series of transactions that gave rise to the tax also gave rise to another tax under the Income Tax Act
• the extent to which payments have been made from the person's TFSA

To consider your request, we need a letter that explains why the tax liability arose, and why it would be fair to cancel or waive all or part of the tax.

According to MoneySense article Apply for waiver of TFSA over-contribution penalties, there is a good chance CRA will waive the penalty, under 207.06(1) of the Income Tax Act, if one withdraws the excess contributions as soon as possible:

Waiver of tax payable

207.06 (1) If an individual would otherwise be liable to pay a tax under this Part because of section 207.02 or 207.03, the Minister may waive or cancel all or part of the liability if

(a) the individual establishes to the satisfaction of the Minister that the liability arose as a consequence of a reasonable error; and

(b) one or more distributions are made without delay under a TFSA of which the individual is the holder, the total amount of which is not less than the total of

(i) the amount in respect of which the individual would otherwise be liable to pay the tax, and

(ii) income (including a capital gain) that is reasonably attributable, directly or indirectly, to the amount described in subparagraph (i).