CRA appears to accept a negative covenant in a TFSA declaration that supports a loan made to the TFSA holder

A TFSA holder can pledge his or her TFSA interest as security for a loan on arm’s length terms – but, per 2013-0514261E5, the loan may not also be secured by the TFSA assets.

However, in a more recent letter, CRA did not seem to be troubled by having a negative covenant inserted in the TFSA declaration requiring that the TFSA maintain a minimum asset level so as to indirectly support the loan to the TFSA holder.

Neal Armstrong. Summary of 27 June 2017 External T.I. 2017-0708951E5 F under s. 146.2(4).