TFSA · Free calculator
A TFSA excess costs 1% a month.
One question: what is this excess costing me? Enter the amount you are over and how many months it stays in the account.
How the CRA charges it
The CRA's rule, in its words: any excess amount in your TFSA is taxable at a rate of 1% per month, calculated on the highest amount of excess in your account for each month it remains. The calculator above applies that flat rate to one excess held still. Read the rule on canada.ca.
Where the flat number understates it
The charge is on the highest excess in each month. If the excess grew mid-month, that month is charged on the peak, not the average. Taking part of it out mid-month does not reduce that month's charge either: the CRA's own example has the tax still applying for the month of the withdrawal. Each of those cases costs more than the figure above.
What you owe the CRA besides the money
An excess means filing an RC243 TFSA return with its Schedule A, and paying, by June 30 of the year after the year the tax applies. The CRA also says excess amounts from a deliberate over-contribution may be taxed at the 100% advantage rate. This calculator never computes that case.
What stops the excess before it starts
An excess is a timing problem: the deposit that lands before the room is back. The app keeps the dated record and warns you before a deposit would take you over, so month one never gets charged. The TFSA side is free.
Written by Mo Kechout CRA figures verified