April 21 Federal Budget | Page 3 | Tax Free Savings Accounts | Discussion forum

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April 21 Federal Budget
April 21, 2015
5:50 pm
kanaka
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It is on the Government of Canada site. But still says "proposed.".

http://www.tfsa.gc.ca

April 21, 2015
6:23 pm
Rick
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Call me an optimist but I'm gong with the "effective immediately" and "limit for 2015"

April 21, 2015
6:31 pm
Loonie
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In the democratic process, I believe the budget must first be passed by Parliament before it becomes law.
Chances of that not happening are next to non-existent in this case, but I'll wait, out of respect for the process if nothing else..
However, there are extreme situations in which it might not pass.

Note too that indexing of the TFSA contribution room for inflation is gone, so we should not count on periodic increases of $500.
This puts control of the contribution limits squarely back into the hands of the government of the day. It could go up or it could go down, at government's whim.

April 21, 2015
6:34 pm
Rick
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Loonie said

In the democratic process, I believe the budget must first be passed by Parliament before it becomes law.
Chances of that not happening are next to non-existent in this case, but I'll wait, out of respect for the process if nothing else..
However, there are extreme situations in which it might not pass.

Note too that indexing of the TFSA contribution room for inflation is gone, so we should not count on periodic increases of $500.
This puts control of the contribution limits squarely back into the hands of the government of the day. It could go up or it could go down, at government's whim.

Justin has already said he will cancel it if elected.

April 21, 2015
6:58 pm
Loonie
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I don't think a new PM can do anything about contributions that were already legally made between when the budget is passed and when he takes office. And the first budget of the new govt wouldn't come before 2016 anyway, almost certainly. And then it has to pass. If there is a minority government, compromises will have to be made.
So I think the new rules will stand for 2015 regardless.

I wouldn't blame any government though for wanting to rescind this change. Although I will benefit personally, I don't think it's a good move for society as a whole.

April 21, 2015
9:18 pm
Ed
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"Although the TFSA limit increase is retroactive to January 1, 2015, and although the Canada Revenue Agency will administer and respect the increased amounts based on today’s announcement, some experts recommend exercising caution in making maximum contributions until the budget passes legislation." https://forwardthinking.tangerine.ca/en/#!/post/budget-2015-tfsa-contribution-limit-increases-to-10000-per-year?hootPostID=cbb8eb96e0ac8891cedda76a5e3cc3d5

April 22, 2015
7:04 am
xxxx
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Assuming Justin Trudeau knows what he can do, he clearly says he plans to repeal the TFSA increase - perhaps one should not rush to put in the additional funds - in the event he might become PM.

April 22, 2015
7:53 am
Bill
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Presumably the Conservative majority government will be able to enact its budget proposals into law before the election, so it's pretty safe to put another $4500 in for 2015 now. Clearly, any future government can do what it wants with TFSA or any other tax shelter at that future time - even terminate it if it thinks that would be a good fiscal and/or politically popular move.

April 22, 2015
1:04 pm
Koogie
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Loonie said
I wouldn't blame any government though for wanting to rescind this change. Although I will benefit personally, I don't think it's a good move for society as a whole.

There have been a lot of limousine leftists and other progressives spouting that in the lead up to the budget announcement. I would assume then that you won't avail yourself of the 10K for 2015 limit ? Otherwise, if you do, it is "bad for society" and that would just be hypocritical, wouldn't it ?

April 22, 2015
3:27 pm
Loonie
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Koogie said

Loonie said
I wouldn't blame any government though for wanting to rescind this change. Although I will benefit personally, I don't think it's a good move for society as a whole.

There have been a lot of limousine leftists and other progressives spouting that in the lead up to the budget announcement. I would assume then that you won't avail yourself of the 10K for 2015 limit ? Otherwise, if you do, it is "bad for society" and that would just be hypocritical, wouldn't it ?

I'd be happy to explain my strategy, but not in response to these kinds of comments. If someone really wants to know, they can ask, without suggestions of hypocrisy and so on.

April 22, 2015
3:35 pm
Loonie
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Brian said

Assuming Justin Trudeau knows what he can do, he clearly says he plans to repeal the TFSA increase - perhaps one should not rush to put in the additional funds - in the event he might become PM.

Did he say when he thought he could make this effective? I didn't actually hear the comment.
I think he would have meant that he would do it as soon as he could. Politicians often say things that get nuanced later and make commitments that will not be honoured for some time, if at all.

April 23, 2015
10:55 am
Ed
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A spokeswoman for Finance Minister Joe Oliver said Wednesday that Canadians can start contributing the extra amount “immediately.”

http://www.theglobeandmail.com.....e24066361/

April 23, 2015
3:29 pm
Dennis
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Another article about it.

A Bank of Montreal official confirmed that the CRA has issued a notice making it clear that contributions can be increased to $10,000 for 2015, and will allow Canadians to take advantage of the increased limit right away, even though it will take weeks to get through all Parliamentary stages.

“For 2015 and subsequent calendar years, the budget proposes to increase the TFSA annual contribution limit to $10,000. The CRA will allow financial institutions and individuals to act upon the new change effective immediately – prior to it passing through Parliament and before receiving Royal Assent.

http://business.financialpost......=30cd-af68

April 23, 2015
4:49 pm
JustMe
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As long as it is NOT a law I would hold contribution. It is the same as gov. propose law to go through red light IF there is no other cars/pedestrians in vicinity and you start going though intersections on red NOW.
Most likely it will be a law but will you make zillion $ contributing NOW instead of being patient?
If you put money with Peoples Trust (2.5%) NOW your 4500 will earn $75 until end of year. Yes, those 75 will buy me a new car, pay my gas bills and a lot will be left to pay for few quickies. Come on, be patient!

April 23, 2015
4:52 pm
Rate Whore
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The change in TFSA is proposed :it has to be voted in the house of commons.The cra site has the info.It will pass since the conservatives have a majority.If you jump the gun you may be penalized,it's best to call the cra.

April 23, 2015
5:14 pm
Bill
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Rate Whore (I don't enjoy writing that 2nd word), you said the "cra site has the info". I went to CRA site and, using Search feature and checking "What's new" page, found no new notice or any reference to the higher TFSA limit. ???

April 23, 2015
6:51 pm
Loonie
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I know everyone's eager to take advantage of this, but CRA should hold off until the bill has passed.

Yes, it's a majority government, and almost certainly the budget bill will be passed, but democracy is a process which actually requires budgets to be passed into law before they take effect, Mr Oliver notwithstanding.

It would take something truly extraordinary to stand in the way of it being passed this time, because of the majority. However, last Fall something truly extraordinary and unanticipated did happen on Parliament Hill. The Conservative caucus was hiding in a caucus room while an assassin was raging the halls outside. If things had gone worse, a lot of the members of that caucus might no longer be with us or would be unable to work and legislation would not get passed. They don't get to vote by proxy.

There will be a general election in the Fall if not sooner. If something disastrous happened before then, there is the possibility that the budget might not get passed. And there would not be enough time for by-elections. BMO and others who say the same thing could be on the hook for encouraging overcontributions, and additional remedial manoeuvres would be needed, costing the gov't more money to sort them out, using our money.

Mr Oliver, BMO, and the NationalPost, want people to believe that there will be no problem. There probably won't be and, for everyone's sake, I hope there isn't. Nonetheless, they are confusing people by trying to shortcircuit the democratic process.

Be patient. Your time will come.

April 23, 2015
7:18 pm
AltaRed
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I would have agreed earlier today, but execs from BMO and CIBC wouldn't be sticking their necks out saying they have word from the CRA that contributions can be made if that was not true. I've made my contribution tonight.

April 24, 2015
5:03 am
xxxx
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Agree with you Alta Red.
The VERY worst that could happen even if the legislation were not passed is that one would need to withdraw the excess amount from one's TFSA.
No need to make a mountain out of a ..............

April 24, 2015
5:43 am
Bill
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Brian, agreed. This is no different than other budgets, CRA's longstanding policy is that retroactive tax changes can be acted on before Royal Assent and in the event budget provisions are changed before then transactions can be "reversed", perhaps with interest and/or penalty being incurred as well. In this case, because TFSAs affect the general populace (this is not a budget item that is aimed at business), there has already been some confusion for some folks re TFSA withdrawals, recontributions, etc, there have been yesterday's directions from Finance to go ahead and contribute $4500, plus it's an election year, you can bet that the government, if this doesn't go through for some unforeseen reason, will direct CRA not to levy any interest/penalty while folks are allowed to withdraw the excess.

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