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My put was assigned in my TFSA. Now what?

Your cash is gone and 100 shares are in its place, bought at the strike. Nothing has left the TFSA, so your contribution room hasn't changed yet. What you do next decides whether this stays a paper loss or becomes a real one.

Options guide · 8-minute read · Updated 2026-10-28

What's in your account right now

You sold a Cash-secured put. The stock closed below the strike. The put was assigned. That means the cash your broker had locked went out, and 100 shares came in, bought at the strike price.

You still have the premium you collected. Nothing was taken out of the TFSA. Shares and cash moved around inside the account, so your contribution room is exactly what it was this morning.

This is normal. Assignment isn't a mistake. It's the other half of the deal you made when you sold the put. It's also the turn in the wheel strategy where you go from selling puts to selling calls.

The numbers for this example (hypothetical)

All numbers are made up.

You put $5,000 into your TFSA. You sold one put on a made-up stock, XYZ, with a $45 strike for $1.00, collecting $100. Your broker locked $4,500.

XYZ fell to $38 and you were assigned. Here's the account now:

That −$600 is real on screen. It isn't locked in until you sell.

Choice 1: hold the shares and sell calls

You keep the shares and sell a Covered call on them. Covered calls are usually the first options trade a broker allows in a TFSA. Check your broker's options levels for the account.

The catch is the strike. Calls above your $44 cost pay little when the stock is at $38. Calls near $38 pay more but could sell your shares at a loss.

The $40 call collects three times as much. It also locks in a loss if XYZ bounces. Pick a strike you'd be fine selling at.

Choice 2: sell the shares now

You sell at $38. You get $3,800. The account holds $4,400 in cash. The loss is now real: −$600.

In a regular account, that loss could cut your tax on other gains. In a TFSA, it can't. There's no capital loss to claim. That's the TFSA trade-off: gains are never taxed, and losses never help.

Selling isn't wrong. It's the right move if you no longer want to own XYZ at any price. It frees the cash for something you'd rather own.

Choice 3: hold and do nothing

You keep the shares and don't sell calls. You wait for XYZ to climb back to $44.

That costs nothing today. But it also collects nothing, and it leaves you fully exposed if XYZ keeps falling:

Ask one question: would I buy 100 shares of XYZ today, at $38, with fresh money? If yes, holding fits. If no, you're only holding to wait for your price back. My page on when you're assigned and the stock keeps falling works through that trap.

The contribution room rule nobody mentions

TFSA room follows what you put in and take out, not what the account is worth.

• A loss inside the TFSA doesn't give you any room back.
• When you take money out, that amount is added back to your room on January 1 of the next year, not right away.
• Put it back in the same year, without spare room, and it counts as an over-contribution. The CRA taxes it at 1% of the highest extra amount, for every month it stays.

Here's what that means for this trade. You put in $5,000. Say you sell at $38 and take out the $4,400. Next year you get $4,400 of room back, not $5,000. The $600 loss used up room you'll never get back.

So don't empty the TFSA to "reset" after a bad trade. If you want to keep investing, keep the cash inside and use it there. The CRA's "Withdrawing from a TFSA" page on canada.ca is where these rules are written down, as of October 2026.

Two TFSA twists to check

US dollars. If XYZ is a US stock, your shares, your cash and your premiums are in US dollars. If your broker converted Canadian dollars to back the put, check whether the leftover cash sits as US dollars or got converted back. Each swap costs a spread. Dividends from US shares in a TFSA also lose 15% to US tax. See US withholding tax on option premiums.

Your next put. If you sell the shares and want to sell another put, the full strike × 100 has to sit in the TFSA in cash. There's no Margin in a TFSA. Not every broker allows puts in a TFSA either. My page on brokers that allow cash-secured puts in a TFSA has the checklist.

The rule for next time

Before you sell a put in a TFSA, write down two prices:

1. The strike. Would you happily own 100 shares there?
2. Your exit. If you're assigned and the stock keeps falling, where would you sell? What would that loss be in dollars?

If that loss in dollars is more than you'd accept from the account, the put is too big. Pick a cheaper stock or a lower strike. More on the full picture in selling options in Canada.

Questions