Canadian High Interest Savings Bank Accounts

First, thanks all, for this great discussion. Its very helpful.

This whole thing of adding withdrawals to next yr makes this very inflexible. Why can't the govt allow people to withdraw and put it back the same yr as long as they don't cross the 5 K / yr limit?

Because of ignorance, I moved my TFSA funds from one bank a/c to another bank a/c last yr. Looks like I will be getting penalty.

Also, how will we know about the penalty? Will we get a bill from CRA?

I'm guessing the gov't makes people wait until the following year to re-contribute because otherwise people could have hundreds or even thousands of transactions that their banks would have to report to CRA which would bring the whole system to a screeching halt. Remember this is a registered account so Big Brother is keeping an eye on each and every transaction you make. Thing is though, I logged into my CRA Account today and while there is a new item for TFSA contributions and withdrawals, CRA doesn't seem to have a record of the 5K I contributed last year through my ING Direct account. Guess I get 5K more in contribution room????????? Well, we can all dream, can't we?