The first step is to make sure you have actually over-contributed to your TFSA. Only deposits are considered to be contributions to your TFSA, so if you've accrued enough interest or earnings in your TFSA your account value may be over the contribution limit, but your actual contributions are not.

For example, say you have the 2019 lifetime maximum of $63,500 available, so you deposited this full amount on January 1st, 2019. Assume your portfolio has been performing well and as a result, your account balance is roughly $65,405. This would not be an over-contribution.

It is also important to note that institutional transfers also would not affect your contribution limit. For example, if you had a TFSA at Bank ABC and transferred it directly to a TFSA with Bank XYZ, this would not count as a withdrawal and subsequent contribution.

What should I do if I have definitely over-contributed to my TFSA?

Over-contributions to TFSAs are subject to a 1% penalty tax per month (only on the over-contribution amount). The CRA has a pretty comprehensive example of how this works here.

Once you know you've over-contributed, it's best to let your TFSA provider know as quickly as possible how much you need to move out of your TFSA. If you've over-contributed to a Wealthsimple Trade TFSA you can withdraw the necessary amount back to a linked chequing or savings account by initiating a withdrawal.