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TFSA Withdrawal at year end
December 27, 2020
1:31 pm
Miron
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Hello, is anyone aware whether a TFSA withdrawal from CT Bank must be made at least 2 days before December 31 in order to be allowed to re-contribute the same amount in 2021? Or is the condition longer than 2 days? Thanks!

December 27, 2020
1:35 pm
Bill
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I haven't heard about this 2 day condition, what is that?

To me, if the amount comes out of your TFSA account on December 31, that's 2020 as far as I know. So you can put it into a TFSA beginning Jan 1, the first day of 2021.

Why wait until the absolute last day? Just take it out on Tuesday.

December 27, 2020
1:50 pm
Miron
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Bill said
I haven't heard about this 2 day condition, what is that?

To me, if the amount comes out of your TFSA account on December 31, that's 2020 as far as I know. So you can put it into a TFSA beginning Jan 1, the first day of 2021.

Why wait until the absolute last day? Just take it out on Tuesday.  

I am sure they added this weird condition but I am not sure whether it is 2 days or am I already late? I am taking the money out tomorrow morning!

December 27, 2020
6:22 pm
Loonie
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I can't comment on CT's policies, but I had a very annoying experience with Meridian the other day which may be relevant.

First thing in the morning on Dec 23, I phoned Meridian to request a withdrawal from RIF HISA (GIC had matured earlier), and to ask them to send a specified amount to CRA which was greater than what was required by law.

I was then told that there would be a "processing time" of either 5 to 10 or 7 to 10 business days (can no longer remember which) .
As this could easily put me into the new year and thus ruin my tax planning, I was quite shocked and infuriated. I certainly wasn't prepared for this, particularly since spouse had done the same manoeuvre the day before at Hubert and the whole thing went through within the hour and showed up online in Transactions.
I asked him why it would take so long since it takes no time at all at another credit union, and he had no explanation other than "processing time".

I think most Regulars on this forum know Meridian is slow at pretty well everything, as is its subsidiary motusbank, but I found this situation alarming.

After I explained the problem, the guy at Meridian, who claimed to be the most senior person available, did appear to understand me, and said that he would ensure that it was all posted for 2020, whatever the processing time might turn out to be.

I sure hope he turns out to be reliable. I have his name and the time I called, but don't want to have to deal with trying to fix it retroactively. I also wonder what their mechanism would be to correct the amounts, including interest, if it only became known in 2021 but applied to 2020. Perhaps their normal sluggishness in issuing statements etc will help.

So I wonder if CT is speaking of "processing time".

January 10, 2021
1:00 pm
Miron
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Loonie said
So I wonder if CT is speaking of "processing time".  

I guess I will find out after CRA will publish my 2021 TFSA room...

January 10, 2021
3:22 pm
Norman1
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Loonie said
… I also wonder what their mechanism would be to correct the amounts, including interest, if it only became known in 2021 but applied to 2020. Perhaps their normal sluggishness in issuing statements etc will help.

It should be fine as long as the amounts are corrected internally before they transmit their 2020 TFSA information to CRA.

TFSA issuers have until the last business day of February to upload their TFSA info for the previous year.

January 10, 2021
4:07 pm
pooreva
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Miron said

I guess I will find out after CRA will publish my 2021 TFSA room...  

Good luck with that; you might wait until June or later 🙁 CRA is never on time regarding TFSA.

January 10, 2021
5:10 pm
topgun
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It looks like I found a good place for TFSA GIC's. I can withdraw NOW or future date it. If transferring to external account it must be setup at least 3 days in advance. I may be restricted to 1 external transfer a month without a fee. No need to transfer out since I have no GIC's maturing for a LONG time. I think I remember CRA did not update my TFSA contribution limit until the end of February last year.

Have a Great Day

January 11, 2021
8:46 pm
Miron
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pooreva said

Good luck with that; you might wait until June or later 🙁 CRA is never on time regarding TFSA.  

It never happened to me... by the end of February, the new room was there and the difference between my records and CRA was a few dollars less 😉

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