The annual TFSA dollar limit is indexed to inflation and rounded to the nearest $500. The Canada Revenue Agency’s indexation increase for 2019 is 2.2%.
For clients who have withdrawn from TFSAs, their crystallized gains and losses from withdrawals are factored in to their TFSA room. Here’s the formula:
Unused TFSA contribution room to date + Total withdrawal made in this year + next year’s TFSA dollar limit = TFSA contribution room at the beginning of next year
Tax bracket thresholds for 2019 have also been released. The federal 33% tax bracket will begin at $210,371 in 2019, up from $205,842 in 2018. On the low end, the basic personal amount for 2019 is $12,069, up from $11,809 in 2018.
The TFSA can be a terrific vehicle to use instead of a RRSP or to complement a pension plan. For more information about using your TFSA to save for retirement. Contact Heidi.
Canadian tips to save money