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TFSA overcontribution
July 16, 2022
7:02 pm
christinad
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Interesting article by Jamie Golumbek on a woman who over contributed to her based TFSA on My Account.

https://financialpost.com/personal-finance/taxes/cra-penalty-tfsa-overcontribution

I have some sympathy as I don’t see anywhere on the Revenue Canada site where it says when My Account is updated. People here may think otherwise. That's sure a lot of tax she had to pay too. I better be careful!

July 17, 2022
5:30 am
cgouimet
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christinad said
Interesting article by Jamie Golumbek on a woman who over contributed to her based TFSA on My Account.

https://financialpost.com/personal-finance/taxes/cra-penalty-tfsa-overcontribution

I have some sympathy as I don’t see anywhere on the Revenue Canada site where it says when My Account is updated. People here may think otherwise. That's sure a lot of tax she had to pay too. I better be careful!  

I do feel for that person but as a person who has made the mistake before, you'd think she'd pay a little more attention to what she's doing and keep some simple records of what she has contibuted.

Also, in My Account (CRA) it clearly shows your contribution room as of Jan 1 2022. I just captured that 5 minutes ago on Jul 17 2022, so anything I might have contributed since Jan 1 2022 isn't yet reflected. Obviously anything contributed to your TFSA isn't yet reflected there.

TFSA-Contibution-Room-2022.JPG

And clicking through that "View TFSA details", you can view all your contributions year by year ...

CGO
July 17, 2022
6:30 am
COIN
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This happened to me earlier this year and I immediately removed the excess.

July 17, 2022
8:24 am
Bill
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CRA let her off the first time, not the second, pretty straightforward, media just stirring things up.

July 17, 2022
8:45 am
RetirEd
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Agreed. Second goof was too much to forgive.
RetirEd

RetirEd

September 5, 2022
12:04 pm
TommyT
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A class action lawsuit should be brought nationwide against Revenue Canada. They clearly state you can cash in your TFSA's but you have to wait until the next calendar year to put the money back in. They should be sued for stating this and then turning around and hitting people with big tax penalties who followed their advice to a tee. Revenue Canada never updates anything and blames their own tardiness on the banks, credit unions and trust companies saying they didn't send the information to them. To date I still can't believe nothing is being done to ratify the situation of being robbed by Revenue Canada when clearly they are the ones at fault. I'm getting too old to personally launch a Canada wide lawsuit against them. I used to live next-door to a judge and he knows they should be sued.

September 5, 2022
12:11 pm
TommyT
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Bill said
CRA let her off the first time, not the second, pretty straightforward, media just stirring things up.  

You don't seem to understand... They clearly state you can cash in TFSA's but have to wait until the next calendar year to put the money back in. Their records lag upwards of one year. They do this on purpose and it's illegal. I've checked into the legality of what they do and how they penalize people who did exactly what they state. People at the limit and cash in TFSA's and wait until the next year to put the money back in but Revenue Canada is slow upwards of one year to update their records. They owe billions of dollars they stole knowingly back to the people who were not in the wrong. I've written articles on this in other forums. I also stated the exact same thing on thegreaterfool.ca and Garth agreed with me.

September 5, 2022
12:14 pm
HermanH
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You can argue the case yourself, at the Federal Court. Only cost you a couple of hundred bucks for the filing fees.

September 5, 2022
12:19 pm
TommyT
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cgouimet said

I do feel for that person but as a person who has made the mistake before, you'd think she'd pay a little more attention to what she's doing and keep some simple records of what she has contibuted.

Also, in My Account (CRA) it clearly shows your contribution room as of Jan 1 2022. I just captured that 5 minutes ago on Jul 17 2022, so anything I might have contributed since Jan 1 2022 isn't yet reflected. Obviously anything contributed to your TFSA isn't yet reflected there.

TFSA-Contibution-Room-2022.JPG

And clicking through that "View TFSA details", you can view all your contributions year by year ...  

You're sadly mistaken with your advice. Everything lags by upwards of one year all due to Revenue Canada's tardiness on "My Account" and they turn around and hit taxpayers who did nothing wrong with big tax penalties which is illegal.

September 5, 2022
12:25 pm
Norman1
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TommyT said

You're sadly mistaken with your advice. Everything lags by upwards of one year all due to Revenue Canada's tardiness on "My Account" and they turn around and hit taxpayers who did nothing wrong with big tax penalties which is illegal.

It is not illegal. You shouldn't waste time or money on the issue.

The taxpayer actually did take CRA to court and she lost. The judge ruled that she did not make an error that was a "reasonable error". Consequently, CRA's decision to refuse to waive the penalty a second time was "reasonable".

September 5, 2022
12:29 pm
cgouimet
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TommyT said

You're sadly mistaken with your advice. Everything lags by upwards of one year all due to Revenue Canada's tardiness on "My Account" and they turn around and hit taxpayers who did nothing wrong with big tax penalties which is illegal.  

Go to court Tommy and let us know how it worked out for you ...

CGO
September 5, 2022
3:54 pm
Bill
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TommyT, you don't get off even if you were told by someone it was ok to do something, you're ultimately responsible for adhering to the law even if you get bad/wrong advice, even from the authorities. There have been cases when CRA has given wrong advice, the judge rules the taxpayer still loses because the law was not adhered to, though in these cases the judge usually asks CRA to "do the right thing in the circumstances" and they usually do some partial or full accommodation. But the onus of adhering to the law is always ultimately yours, maybe they're not teaching that in school any more. You can imagine the chaos and inequity if the the written laws as passed by the representatives we've elected are discarded in favour of each judge deciding on their personal assessment that day of the situation.

You don't seem to understand the time lag. If you make a contribution to your TFSA CRA won't even know about it until March or so of the following year, then it takes a while for them to update MyAccount. And yes, you CAN put money you take out back in the following year, that rule does not say it is to be disregarded when CRA is tardy in updating MyAccount.

But give court a shot, go for it, I believe you have to start at the Tax Court of Canada level (don't even need to hire a lawyer in most cases, give 'em heck yourself!), if you lose you can go to Federal Court. Let us know!

September 5, 2022
3:59 pm
cgouimet
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cgouimet said

Go to court Tommy and let us know how it worked out for you ...  

And let us know how to stream it live ... 🙂

CGO
September 6, 2022
6:18 am
savemoresaveoften
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Even CRA opened asked tax payers to check their OWN records re contribution and never once claimed their record is up to date to be used as gospel...

There is just too many people around who likes to blame others when its clearly their own fault. That lady is one of those. CRA already forgave the first mistake. She should be vigiliant to not make the same mistake again and again...

September 7, 2022
7:08 pm
christinad
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I don’t agree. What cgouimet posted wasn’t exactly in your face, it could be more prominent that its not up to date. We don’t know how many people this has happened to. If its a lot they could change the notification. In any event i enjoy these golumbek articles for people who don’t read them. He regularly writes on tax disputes.

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