The Tax-Free Savings Account (TFSA) program started in 2009. Every Canadian resident who was 18 or older in a given year (starting 2009) accumulates that year's annual limit as contribution room, whether or not they actually opened a TFSA at the time. This means even if you didn't open an account until recently, you may have substantial unused room going all the way back to 2009 or the year you turned 18.
| Years | Annual limit |
|---|---|
| 2009 – 2012 | $5,000/year |
| 2013 – 2014 | $5,500/year |
| 2015 | $10,000 |
| 2016 – 2018 | $5,500/year |
| 2019 – 2022 | $6,000/year |
| 2023 | $6,500 |
| 2024 – 2026 | $7,000/year |
Someone who has been eligible since the program began in 2009 has accumulated $109,000 in total room by 2026, assuming they've never contributed before.
Unlike many savings accounts, withdrawing money from your TFSA doesn't shrink your contribution room forever. The withdrawn amount is added back to your available room — but only starting January 1st of the following year, not immediately. This makes the TFSA genuinely flexible for both long-term saving and shorter-term goals, as long as you're careful about the timing if you plan to re-contribute the same year.
If you contribute more than your available room, the CRA charges a penalty tax of 1% per month on the excess amount, for every month it remains in the account. This adds up quickly and is one of the most common, avoidable TFSA mistakes — always verify your exact room on CRA My Account before making a large contribution, especially if you've had multiple TFSA accounts at different institutions over the years.