CRA My Account | Financial Crooks

It’s not unusual for people to have TFSAs (or RRSPs) at more than one bank, trust company or financial institution. I strongly recommend that if you do, you should keep careful track yourself of your contributions and withdrawals from your TFSA. And just like checking your credit rating once in a while, it doesn’t hurt to check what the government thinks you’ve contributed to and withdrawn from your TFSAs; here’s how.

Why Should You Care What the Government Thinks You’ve Done With Your TFSA?

In an ideal world, you wouldn’t need to care what the tax department thinks you’ve done with your TFSA. Life isn’t always perfect though.

Here’s an example: A couple of year’s ago, a major discount brokerage had a computer glitch that sent incorrect TFSA info to the CRA. Basically, it reported people as having made contributions twice the size of their actual contribution because it reported each contribution twice. When the CRA computer ran some routine looking for over-contributions, it found these accounts and mailed out letters to the owners telling them they owed whopping fines for their over-contributions. It all got settled without anyone having to pay a fine on money they didn’t contribute but it was still a hassle.

Here’s a possible scenario: Say you have a TFSA at one bank or brokerage but after a few years you withdraw the money December 31 and deposit it elsewhere January 1 and life goes on. Almost two years pass and the CRA sends you a letter saying you have over-contributed which you know is wrong. You decide to print out your TFSA statements to prove it and then realize with a sinking feeling that you can’t get access to those e-Statements anymore since you don’t bank with that institution anymore. And your hard drive crashed with your only e-copies. Now you have to contact a bank you don’t have a “relationship” with any more to ask them to try to get you those archived e-Statements. Sound fun? Not to me. If you’d checked your government TFSA report you might have been able to correct the mistake more quickly or with less hassle.

What Penalties Does the CRA Inflict for TFSA Mis-Management?

Have you ever wondered who invented nitroglycerine or who discovered rhubarb leaves and roots are poisonous but the stems are edible? Those people are cousins to the ones who experiment with every new type of government tax-minimizing-deferring-and-deleting policy. As a result of people stretching TFSAs way beyond how they were intended to be used, the government has instituted some fairly nasty penalties for mis-using them.

If you over-contribute, deliberately or not, to your TFSA, the government can charge you a fine of 1% per month on the over-contributed amount.

For example, if you over-contributed $2000, they can charge you $20 per month for each month the money stays in there. So if you put it in April 30 and withdraw it May 1, they could charge you $40 unless you could prove it was not intentional and they decided to be nice and waive the fine.

If you leave $2000 in for 12 months, they can charge you $240.

Some people were quite willing to pay $240 a year if they could invest $2000 and not pay any taxes on the profits. So the government tightened its grasp again and passed a rule permitting a fine equal to the amount of the ENTIRE profit generated by the over-contribution.

That’s right, you could get billed the $240 fine PLUS they could take every cent of profit made on that $2000 investment. So by over-contributing you would pay more in tax than if you just invested in a non-registered account, and in fact you would lose money not make money.

If you do find you’ve accidentally over-contributed

withdraw the extra money immediately
write a letter to the CRA immediately explaining what happened and requesting forgiveness for this one-time mistake

How Up to Date is the Government’s Info on TFSA Contributions and Withdrawals?

The government data is updated when the banks, credit unions and other financial institutions send in their reports about TFSA contributions and withdrawals.

So generally the government information is only up to date as of December 31 of the previous year by about April of the current year. In other words, in May 2014, my data is only up to date as of December 31 2013. My contribution made on January 1 2014 is not reported in my CRA My Account yet.

According to the CRA website: “By the last day of February of the following year, all issuers are required to electronically submit a TFSA record to CRA for each individual who has a TFSA.”

This record includes the dates and amounts of all TFSA contributions or withdrawals for the previous year. For example according to the CRA website, the record could include

a transaction date and the TFSA contribution amount
a transaction date and the TFSA withdrawal amount
a transaction date and the marriage breakdown transfer out amount
a transaction date and the marriage breakdown transfer in amount
a transaction date and the fair market value of an acquisition of a non-qualified investment
a transaction date and the fair market value of a withdrawal of a non-qualified investment
the date of death of fair market value of the assets at death

How to Check the Government’s Record of Your TFSA Contributions and Withdrawals

The easiest way to get this information is to join the CRA My Account service. It takes a bit of time to get access (about 3-5 mail delivery days) but it works.

If necessary apply for a CRA Security Code online.

When you receive your code in the mail, three to five mailing days later, sign in to your personalized CRA My Account.

Once signed in, here’s how to check your TFSA transactions.

Click on the tab entitled RRSP and savings plans.
Click on the link: Tax-Free Savings Account (TFSA)
Click on the link: Transaction Summary
Read the information, then click on the Continue button.

The TFSA Transaction Summary Search Screen
To see all of your transactions (withdrawals and contributions) at all banks and institutions since the plan began, leave the drop-down lists at their default settings of

all financial institutions
January 2009
December 2013

And click on the Continue button.

The TFSA Transaction Summary Screen
A neat table will be displayed listing your contributions and withdrawals first by financial institution and then by date.

I’d forgotten I withdrew $205 accidentally in 2009 till I looked at this table. (I waited till January 1 2010 to put it back in so it never caused any problems with the CRA.)

If desired, highlight and copy the information and paste it into a document for your files.
When you are finished reviewing your information, click on the Logout button.
Click on the Exit button.
For improved security, clear your cache and close your browser session.

How Can I Get my Government TFSA Transaction History Corrected?

As the people whose brokerage mis-reported their TFSA contributions found out, to get the government records corrected, they had to get the brokerage to submit the correction to the CRA.

If you find an error in your TFSA contributions or withdrawals, you must get your TFSA “issuer” to send an “amended record” to the CRA to update their records.

You can certainly contact the CRA and tell them what’s wrong and what you’re doing to get it fixed. They may or may not add a note to your file. But, unfortunately, you must get the bank or financial institution to send in the correction; you can’t just get it corrected by writing the CRA yourself.

What Will the Government Do If I Over-Contributed?

Generally, the CRA will send you a letter and a TFSA return and payment package if you over-contribute to your TFSA. The fine starts the day you over-contributed, though, not the day they advise you of the problem. So if you know you have over-contributed, get the money out immediately!

Related Reading

Join In
Have you ever reviewed your TFSA transaction history on the CRA My Account website? Did you spot any strange information? Please share your experiences with a comment.

Recently I discovered that I have made a small reporting error on my T2125s for the last 10 years. It’s a factual typographical error, not an error in my taxes, thank goodness. Still, I want to get it corrected. I knew I could submit a bunch of T1-ADJ forms by mail but I thought it might be cheaper to do it online. To submit the changes to my tax returns online, though, I need to use my CRA My Account which I don’t have access to yet. This is how I got started; if you need to adjust your taxes or want to check your TFSA contribution and withdrawal history etc, you might want to apply for access to your CRA My Account files too.

The Two Levels of Access to a CRA My Account File

You can get almost immediate access to the first level of your CRA My Account file. You’ll need to know some basic information about yourself and about your last assessed tax return.

To get full access, though, you’ll have to wait for the CRA to mail you a CRA Security Code. It takes 3-5 Canada Post delivery days for the code to arrive in your mailbox.

Setting up Your CRA My Account Id and Password

To get any access at all, you need to perform the following steps.

Go to the Canada Revenue Agency My Account for Individuals page at http://www.cra-arc.gc.ca/esrvc-srvce/tx/ndvdls/myccnt/menu-eng.html
Click on the CRA Register button.
Type your Social Insurance Number in the text box.
Click on the Continue button.

The Validate Your Identity Screen

From the drop-down lists, select your Date of Birth.
In the text field, type your Postal Code.
In the Tax information field, type the amount requested from the line specified from your last assessed income tax return. For example, they may ask you to type in the amount you reported on Line 120.
Click on the Continue button.

The Postal Code/ZIP Code Verification Screen

If your postal code is correct, click on the Yes button.
The CRA will then mail you your CRA Security Code.

The Create Your CRA User ID and Password Screen

In the User ID field, type the id you want to use when accessing your CRA My Account.
It has to be 8-16 characters long, with no spaces and no more than 7 numbers.
In the Password field, enter the password you want to use with the id.
In the Confirm Password field, re-type the new password.
Click on the Continue button.

The Create Your Security Questions and Answers Screen

From the drop-down list, select Question 1.
Type the answer in the Answer 1 text field.
From the drop-down list, select Question 2.
Type the answer in the Answer 2 text field.
From the drop-down list, select Question 3.
Type the answer in the Answer 3 text field.
From the drop-down list, select Question 4.
Type the answer in the Answer 4 text field.
From the drop-down list, select Question 5.
Type the answer in the Answer 5 text field.
Keep selected the option: Ask me a security question each time I login (recommended). It’s safer to use the site with this option.
Click on the Continue button.

The Review My Security Questions and Answers screen
If everything looks fine, click on the Continue button.

The Terms and Conditions of Use Screen

In the Password field, type in your new password.
Click on the “I agree” button.

The CRA Security Code Notification screen
Click on the Quick Access button.

The Terms and Conditions of Use Screen
Read the terms and if you can accept them, click on the I Agree link.

What Information is Available Before I Get My CRA Security Code in the Mail?

While waiting for your CRA Security Code letter to arrive in the mail, you can use the CRA My Account website to see a bit of information. This includes:

For which year your last return was assessed, and, if applicable, when a refund was deposited into your bank account.
How much you can contribute to your RRSP for the current year
How much you could contribute to your TFSA on January 1 of the current year. This information is not always accurate. I urge you to keep your own up-to-date records as the CRA records are only updated once a year.
The benefit payment status for your CCTB, GST/HST credit, UCCB

You can also use a link to request the CRA mail you out a remittance form for payments you wish to make on your taxes.

Click on the Logout button.
Click on the Exit button.
Close your browser session.

Waiting for your CRA Security Code

It took about 3 mailing days for my code to arrive.

How to Get Access to your CRA My Account Tax Information Online Using Your CRA Security Code

Once you get your CRA security code in the mail:

Open your web browser and go to: www.cra.gc.ca/loginservices
Click on the My Account button.
Click on the link called CRA Login.
In the User ID: field type the id you created earlier.
In the Password field, type the password you created earlier.
Click on the Login button.
Answer your Additional Security Feature question.
Click on the Continue button.
Check that the date and time of the last CRA login is correct for the last time you accessed your account; if it is click on the Continue button.
Read the CRA Security Code Entry information. Then, in the CRA Security Code field, type the code from your letter.
Then click on the Continue button.
Read the My Account Terms and Conditions of Use. If you are willing to accept them, click on the I agree link.

On the Welcome screen are links to your latest Notice of Assessment and possibly a link to view your T4 and other tax slip information.

I’m now ready to file a bunch of T1-ADJs to fix that annoying mistake!

Related Reading

What Info (T4, Tax Owing, RRSP Limits) Can You See Online from your CRA My Account Website?

Join In
Did you apply for access to your CRA My Account website? Did you get your security code in the mail in a reasonable amount of time? Please share your views with a comment.

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How Can I Check What the Government Thinks Were My TFSA Contributions and Withdrawals?