TFSA - New Form For Designation of an Exempt Contribution

The CRA has released a draft of a new form RC240 Designation of an Exempt Contribution Tax-Free Savings Account.  This form is to be used to designate an exempt contribution when a TFSA holder passes away.  The successor holder of the TFSA obtains the rights to the arrangement and can use the form to complete a qualifying transfer to their TFSA.

 

An exempt contribution is an amount that has been designated by a TFSA holder's survivor regarding a payment received from the deceased holder's account.  Form RC240 is completed when a taxpayer is a recipient of a survivor payment from a TFSA and the form helps to calculate the maximum amount that may be designated as the exempt contribution.

 

For a link to the form click here, for more information on Tax-Free Savings Accounts, go to www.cra.gc.ca/tfsa.