The TFSA contribution limit for 2018 will remain $5,500.
The indexation adjustment for personal income tax and benefit amounts is 1.5% for 2018, which is not enough to raise the TFSA limit to the next $500 increment.
In 2017, the Consumer Price Index has fallen from 2.1% in January to 1.4% in October, reaching a low of 1% in June.
With the TFSA limit at $5,500 for 2018, the total room available in 2018 for someone who has never contributed and has been eligible for the TFSA since its introduction in 2009 is $57,500.
For clients who have withdrawn from TFSAs, their crystallized gains and losses from withdrawals are factored in to their TFSA room. Here’s the formula:
Unused TFSA contribution room to date + Total withdrawal made in this year + next year’s TFSA dollar limit = TFSA contribution room at the beginning of next year
TFSA limits will remain indexed to inflation for future years.
Tax bracket thresholds have also been confirmed. The federal 33% tax bracket will begin at $205,842 in 2018, up from $202,800 in 2017. On the low end, the basic personal amount for 2018 is $11,809, up from $11,635 in 2017.