The depth of the Labrador Sea mixed layer during winter convection is a balance between atmospheric buoyancy loss and lateral buoyancy exchange, and is notoriously difficult to represent accurately in ocean and climate models. This study shows that lateral exchanges of heat and salt between the shelf and the interior are smaller in a regional coupled ocean–sea ice model at higher vertical resolution (75 levels compared with 50 levels), due in part to altered bathymetry along the Greenland shelf. Reduced lateral exchange results in a stronger stratification in the interior of the Labrador Sea, with stronger convection resistance which results in unrealistically shallow mixed layers. The westward fluxes of heat and salt associated with Irminger Water at Cape Farewell are 50 % and 33 % lower, respectively, with higher vertical resolution. Exchanges south of the Labrador Sea from the North Atlantic Current are also smaller, contributing to a reduction in salt and heat import into the Labrador Sea interior. When the high resolution model is forced with a stronger wintertime buoyancy loss at the ocean surface, this weakens the Labrador Sea stratification, allowing the forcing to break through the freshwater cap and increasing convection, bringing mixed layer depths back to observed values. A strong atmospheric forcing can therefore compensate for a reduction in lateral advection. The mixed layer depths, which are representative of convection and Labrador Sea water formation, will be the focus in this study. Therefore, this study suggests that convection and Labrador Sea Water formation is a complex interplay of surface and lateral fluxes, linked to stratification thresholds.