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Published January 30, 2023

15 Best Cash Back Credit Cards in Canada for 2023

The best cash-back credit cards in Canada deliver high earn rates, multiple rewards catefories and premium perks.

Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own.

When it comes to the complex world of credit card rewards, there are few words as simple — or as sweet — as “cash back.” If you’re looking for a cash-back credit card in Canada, you have plenty of choices. Of the 88% of credit cards in Canada that provide rewards programs, 41% of them offer cash back, according to 2021 report by Payments Canada.

But not all cash-back cards are created equal, and picking the right one requires a little research. Our picks for the best cash-back credit cards in Canada include top contenders across numerous card categories so you can choose the right one for your spending habits and financial goals.

Neo Card™

Get $25 cash back and access up to $8,000 in credit when you sign up for a Neo Card. Skip the fees and earn up to 15% cash back on first-time purchases and an average of 5% cash back at 10,000+ partners.

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Best cash-back credit cards in Canada

Best for cash back on gas + best intro offer + our pick for a high ongoing earn rate + best American Express card

SimplyCash® Preferred Card from American Express

SimplyCash® Preferred Card from American Express
  • Annual Fee
    $119.88
  • Interest Rates
    20.99% / 21.99%
  • Rewards Rate
    2%-4%
  • Intro Offer
    Up to $400
Our Take
Why we like it

Get rewarded at the gas station and grocery store with 4% cash back, plus enjoy a high ongoing flat-rate of 2% cash back on everything else.

Pros
  • The unlimited 2% cash-back earn rate is among the highest we evaluated.
  • You can earn up to $400 in the first ten months.


Cons
  • The bonus rewards rate on gas and groceries drops down to 2% after a $30,000 annual spend.
Product Details
  • In your first 10 months as a new SimplyCash® Preferred Card from American Express Cardmember, you can earn a $40 statement credit for each monthly billing period in which you spend $750 in purchases on your Card. This could add up to $400 in statement credits in the first 10 months.
  • Earn accelerated earn rates on eligible gas and grocery purchases.
  • Earn 4% cash back on eligible gas station purchases in Canada, 4% cash back on eligible grocery store purchases in Canada (up to $1,200 cash back annually) and 2% cash back on all other purchases.
  • Access events and special offers curated for Cardmembers with American Express® Experiences.
  • Extensive insurance coverage and 24/7 Customer Service.
  • American Express is not responsible for maintaining or monitoring the accuracy of information on this website. For full details and current product information click the Apply now link. Conditions apply.

Best cash back card + our pick for accelerated earn rates + best Mastercard

BMO CashBack® World Elite®* Mastercard®*

BMO CashBack® World Elite®* Mastercard®*
  • Annual Fee
    $120
    Waived first year
  • Interest Rates
    20.99% / 23.99%
  • Rewards Rate
    1%–10%
  • Intro Offer
    Up to $260
Our Take
Why we like it

You won’t need a strategy to make the most out of this bonus-category card. The BMO CashBack® World Elite®* Mastercard®* spends like a flat-rate card thanks to stellar rates on four popular daily spending categories.

Pros
  • Score generous cash-back rates for popular spending categories: 5% on groceries, 4% on transit, 3% on gas, 2% on recurring bills, and 1% on everything else.
  • Feel protected with 13 types of insurance and fantastic travel benefits.


Cons
  • Spending categories come with easily-hit spending caps, but the 1% base rate still earns you value once you hit your monthly bonus rate limits.
  • The $120 annual fee is pretty steep. While we think you’ll more than make up for it through cash back savings, the no-fee BMO CashBack® Mastercard®* is a great alternative.
Product Details
  • Welcome offer: Get up to 10% cash back in your first 3 months and the $120 annual fee waived in the first year.*
  • Earn more cash back on the categories that mean the most: 5% on groceries.* 4% on transit including ride sharing, taxis and public transportation.* 3% on gas and electric vehicle charging.* 2% on recurring bill payments like your monthly phone bill or favourite streaming service.* 1% unlimited cashback on all other purchases.*
  • Get the highest cash back earn rate on groceries in Canada.†
  • Get valuable benefits and offers for digital everyday services from a variety of on-demand apps and subscription services.
  • Extended Warranty Plus.*
  • Purchase Protection Plus.*
  • Complimentary membership in Mastercard Airport Experiences provided by LoungeKey.*
  • Access over 1 million Wi-Fi hotspots around the world – all at no added cost, and no added fees or roaming charges.*
  • Complimentary Roadside Assistance Program.*
  • BMO CashBack World Elite Travel and Medical Protection.*
  • BMO Concierge Service.*
  • Unlock Mastercard Travel Rewards cashback offers when you travel and shop outside of Canada.
  • *Terms and conditions apply.
  • †Statement based on a comparison of the non-promotional grocery rewards earn rate on Canadian cash back credit cards as of June 1, 2022.
  • BMO is not responsible for maintaining the content on this site. Please click on the Apply now link for the most up to date information.

Best secured card for cash back

Neo Card™ (Secured)

Neo Card™ (Secured)
  • Annual Fee
    $0
  • Interest Rates
    19.99%-26.99%
  • Min. Deposit
    $50
  • Maximum Deposit
    $10,000
Our Take
The Neo Card™ (Secured) is a no-fee card that earns cash back rewards and offers access to high-interest savings.

Pros
  • A small $50 minimum deposit makes this card accessible to consumers of all budgets.
  • Earn up to 15% cash back on purchases with select Neo partners.


Cons
  • Interest rates could be as high as 26.99% for some users.
  • While Neo plans to report card activity to TransUnion, the company has confirmed that this function isn’t fully operational yet, so the credit-building benefits of this card will be delayed.
Product Details
  • Earn a 0.5% cash back guarantee, an average of 5% unlimited cash back at thousands of Neo partners, and up to 15% cash back on your first purchase at participating partners.
  • No annual fee for the Standard rewards plan.
  • $50 minimum security fund deposit required.
  • $10,000 maximum security fund deposit.
  • To apply, visit member.neofinancial.com and create an account. Select “Credit”, pick either the Neo Card™ or the Hudson’s Bay Mastercard, and then choose “Secured Card” as the type of credit you are looking for.
  • Hard credit checks are not made on applications.
  • Guaranteed approval, as long as you meet eligibility requirements.
  • Ability to upgrade to an unsecured rewards credit card.
  • Link your account to a Neo Money™ account and earn 2.25% interest on savings.
  • Purchase rates range from 19.99%-26.99%. The standard rate on purchases and cash advances is dependent on Neo Financial’s assessment of your credit application, credit profile, and your province.
  • To be eligible, you must be able to provide security funds and be a Canadian resident of the age of majority in the province or territory where you live.

Best for cash back on groceries and pre-authorized debits + our pick for newcomers to Canada + best Visa card

Scotia Momentum® Visa Infinite* Card

Scotia Momentum® Visa Infinite* Card
  • Annual Fee
    $120
    Waived first year
  • Interest Rates
    20.99% / 22.99%
  • Rewards Rate
    1%-10%
  • Intro Offer
    Up to $200
Our Take
Why we like it

Earn up to $1,000 in cash back on grocery shopping and recurring bill payments with a 4% rewards rate in both categories.

Pros
  • It’s rare for a credit card to offer 4% cash back on two major spending categories. It’s even rarer to set a $25,000 annual limit to that 4% — a $1,000 value — before reverting to the healthy 1% base rate.
  • You can waive the $120 annual fee every single year by using the Scotiabank Ultimate Package.


Cons
  • The cash back earned is hands-off. You have to wait until November, and then it’s only redeemable as a statement credit. If you have a Scotiabank account, that annual payout can be deposited into your bank account.
  • The 4% rate won’t mean much to you if you don’t buy a lot of groceries or often buy your food at somewhere that Visa doesn’t classify as a grocery store or supermarket, such as Canadian Tire, FreshCo, London Drugs, Walmart and No Frills.
Product Details
  • SPECIAL OFFER: Earn 10% cash back on all purchases for the first 3 months (up to $2,000 in total purchases). No annual fee in the first year, including on supplementary cards. Offer ends April 30, 2023.
  • Earn 4% for every $1 you spend on grocery store purchases, recurring bill payments, and subscription purchases.
  • Earn 2% for every $1 you spend on gas purchases and daily transit purchases.
  • Earn 1% cash back on all other purchases with no cash back limit.
  • Redeem cash back as a statement credit in November.
  • Visa Infinite benefits, including Visa Infinite* Concierge, Visa Infinite* Luxury Hotel Collection, Visa Infinite* Dining Series, and entertainment and lifestyle offers.
  • Save up to 25% off base rates at participating AVIS locations and at participating Budget locations in Canada and the U.S.
  • Access to Scotia SelectPay™.
  • To be eligible, $60,000 (individual) or $100,000 (household) annual income is required, or $250,000 minimum assets under management. Also, you must have a Canadian credit file and be a Canadian resident that is the age of majority in the province or territory where you live.
  • Terms and Conditions Apply. Click ‘Apply Now’ for complete details.

Best flat-rate cash back card

RBC Cash Back Preferred World Elite Mastercard

RBC Cash Back Preferred World Elite Mastercard
  • Annual Fee
    $99
  • Interest Rates
    19.99% / 22.99%
  • Rewards Rate
    1%-1.5%
  • Intro Offer
    N/A
Our Take
Why we like it

You can earn unlimited cash back at a competitive flat rate on all of your purchases.

Pros
  • Flat-rate cash-back rewards are easy to understand and earn.
  • Save on gas and earn 20% more Petro-Points at Petro-Canada.


Cons
  • The insurance coverage is limited when compared to similar cards.
  • There’s no welcome bonus or sign-up offer.
Product Details
  • Unlimited cash back on your spending*.
  • Earn up to 1.5% cash back on your spending† – big or small.
  • Premium benefits and insurances.
  • Stay connected with a complimentary Boingo‡ Wi-Fi accountΔ.
  • Link your RBC card with a Petro-Points membership and instantly save on fuel at Petro-Canada stations and earn 20% more Petro-Points.
  • Get $0 delivery fees for 12 months from DoorDash¹⁷ – Add your eligible RBC credit card to your DoorDash account to: Get a 12-month complimentary DashPass subscription¹⁸ – a value of almost $120. Enjoy unlimited deliveries with $0 delivery fees on orders of $15 or more when you pay with your eligible RBC credit card.
  • To be eligible, $80,000 (individual) or $150,000 (household) annual income is required. Also, you must have a Canadian credit file and be a Canadian resident that is the age of majority in the province or territory where you live.
  • Corresponding legal references and product terms are available on the RBC website, which will be available and agreed upon in the customer onboarding process.

Best cash back card for balance transfers

BMO CashBack® Mastercard®*

BMO CashBack® Mastercard®*
  • Annual Fee
    $0
  • Interest Rates
    19.99% / 22.99%
  • Rewards Rate
    0.5%-5%
  • Intro Offer
    Up to $125
Our Take
Why we like it

The BMO CashBack® Mastercard®* offers attractive earn rates on everyday purchases like groceries and utility bills, making it easy to quickly rack up rewards that you can turn into cold hard cash.

Pros
  • Attractive introductory offer, especially if you’re interested in a balance transfer.
  • No minimum threshold for redeeming your cash-back rewards. Redeem as little as $1 if you want.


Cons
  • Accelerated earn rates for groceries and recurring bills are capped at $500 per billing cycle, a ceiling that might be easy to hit if you have a family or higher monthly balances.
  • Offers fewer travel perks and types of insurance than some other cards.
Product Details
  • Welcome offer: Get 5% cash back in your first 3 months.*
  • Then get 3% cash back on grocery purchases, 1% cash back on recurring bill payments and 0.5% unlimited cash back on all other purchases!*
  • Now earn the highest cash back on groceries in Canada without paying an annual fee!†
  • Get a 0.99% introductory interest rate on Balance Transfers for 9 months, 2% fee applies to balance amounts transferred.*
  • No Annual fee.*
  • Want to get your cash back ASAP? Now you can redeem your cash back anytime through direct deposit, as a credit on your statement or into your BMO InvestorLine account.*
  • Extended Warranty.*
  • Purchase Protection.*
  • Receive a discount on car rentals.*
  • *Terms and conditions apply.
  • †Based on a comparison of the non-promotional grocery rewards earn rate on cash back credit cards with no annual fee as of June 1, 2022.
  • BMO is not responsible for maintaining the content on this site. Please click on the Apply now link for the most up to date information.

Best for cash back on travel + our pick for fair credit and flexible reward categories

Tangerine Money-Back Credit Card

Tangerine Money-Back Credit Card
  • Annual Fee
    $0
  • Interest Rates
    19.95%
  • Rewards Rate
    0.5%-15%
  • Intro Offer
    Up to $150
Our Take
Why we like it

You can earn unlimited cash back at a 2% rate in up to three categories of your choice — all while earning 0.50% back on everything else.

Pros
  • You can tailor the 2% rewards to your spending by choosing up to three categories from Tangerine’s list of 10, which includes basics like gas and groceries as well as unusual picks like furniture and home improvement.
  • Transfer balances within your first 30 days and pay only 1.95% interest on the transferred balance for the first six months (19.95% after that).


Cons
  • 2% cash back is a competitive rate, but many cards offer double the rewards on specific categories.
  • Tangerine is a virtual bank with no physical bank branches.
Product Details
  • 2% on two categories of your choice: grocery, furniture, restaurants, hotel-motel, gas, recurring bill payments, drug store, home improvement, entertainment, or public transportation and parking.
  • Get a third cash-back category by choosing to have your rewards deposited into a Tangerine Savings Account.
  • 0.50% on everything else.
  • Redeem cash back monthly as a statement credit or deposited into a Tangerine Savings Account.
  • No annual fee.
  • Transfer balances within your first 30 days and pay only 1.95% interest on the transferred balance for the first six months (19.95% after that). 1% balance transfer fee applies to the amount transferred.
  • Get free cards for any authorized users on your account.
  • It only includes purchase assurance and extended protection insurance. For more insurance, consider the Tangerine World Mastercard which requires a minimum personal income of $60,000. If you meet this requirement, you will automatically be considered for the World card if you apply for the Money-Back card.
  • Preferred rates: 19.95% for purchases and cash advances.
  • To be eligible, a $12,000 (individual) annual income is required. Also, you must have a Canadian credit file and be a Canadian resident of the age of majority in the province or territory where you live.

Best prepaid card for cash back

KOHO Standard Prepaid Mastercard

KOHO Standard Prepaid Mastercard
  • Annual Fee
    $0
  • Rewards Rate
    0.5%-6%
  • Min. Deposit
    $0
  • Maximum Deposit
    $200,000
  • Intro Offer
    N/A
Our Take
Why we like it

KOHO offers two tiers of prepaid cards: a standard card and a premium card. Both combine the benefits of a debit card and a credit card with cash back rewards, limited fees and the ability to build credit. Plus, KOHO doesn’t charge interest — instead, they let you earn interest on every dollar you save in your KOHO account.

Pros
  • An app that tracks your spending, helps with budgeting, offers free financial coaching, and the ability to earn 1.2% interest on your entire account.
  • Access to a credit building service that reports your payments for only $10 per month — a rare feature for a prepaid card.


Cons
  • KOHO is a tech-focused company, so if you’re uncomfortable with digital banking, it may not be the right choice.
  • KOHO isn’t a credit card, which means you can’t borrow any money. You can only access the funds already in your account.
Product Details
  • Up to 5% cash back at select KOHO Partners.
  • 0.5% cash back on all purchases.
  • Cash back is instantly added to your KOHO Savings account.
  • $0 annual fee.
  • Choose from one of four card colours.
  • Receive both a physical and virtual card. For new users, you can start adding funds and shopping online while you wait for your physical card to arrive in the mail. No need to budge from your couch to make online Purchases! Just use your virtual card instead of getting up to find your wallet. Plus, it uses a different card number to help protect your physical card number when you’re shopping or booking services online.
  • Add your KOHO card to Apple, Samsung or Google Pay.
  • Access your payroll up to 3 days early with the Early Payroll feature.
  • Automate your savings with Goals and RoundUps. Rounding up every Purchase lets you stash away some savings, while Goals make it easier to save for whatever it is that makes you happy.
  • Lock in savings with Vault that keeps the funds you don’t want to spend separate from your spendable balance.
  • Create custom budgets and track your spending habits. Know where you’re at in real time with instant notifications every time you spend.
  • To be eligible, you must be a Canadian resident of the age of majority in the province or territory where you live.
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Full List of Editorial Picks: Best Cash Back Credit Cards in Canada

TD Business Cash Back Visa* Card

Best no-fee cash back business card

Our Take
Why we like it

The TD Business Cash Back Visa* Card is a no-fee card that earns competitive rewards on office supplies, gas, and recurring bills.

Simplii Financial™ Cash Back Visa Card

Best no-fee cash back card + best for cash back at restaurants + our pick for students

Our Take
Why we like it

The $0-annual-fee Simplii Financial Cash Back Visa Card earns bonus cash-back on the purchases you make almost every day.

Meridian Visa Platinum Cash Back Card

Best for cash back at drug stores

Our Take
Why we like it

Benefit from a full suit of insurance coverage, plus rewards on everyday spending, with the Meridian Visa Platinum Cash Back Card.

Triangle™ World Elite Mastercard®

Best for cash back on in-store shopping

Our Take
Why we like it

The Triangle™ World Elite Mastercard® is the ideal choice for shoppers hoping to collect and redeem as much Canadian Tire Money as possible. The roadside assistance package cardholders get access to is a nice perk, too.

Amazon.ca Rewards Mastercard®

Best for cash back on online shopping

Our Take
Why we like it

Ideal for Amazon shoppers with 2.5% back on all eligible Amazon.ca and Whole Foods purchases. Plus, Amazon Prime members get 2.5% back on eligible foreign currency transactions.

Rogers™ World Elite® Mastercard®

Best for cash back on USD purchases

Our Take
Why we like it

The Rogers World Elite Mastercard is a no-fee card with an easy-to-understand cash-back rewards program with an accelerated earn rate on U.S. dollar purchases. And unlike some no-fee cards, it still offers valuable perks for those who like to travel.

Meridian Visa Infinite Business Cash Back Plus Card

Best cash back business card

Our Take
Why we like it

It may be short on perks, but by offering 1.5% cash back on all purchases, the Meridian Visa Infinite Business Cash Back Plus Card provides a reliable way for businesses to take a bite out of their expenses.

Methodology to choose the best cash-back credit cards

NerdWallet Canada selects the best cash-back credit cards based on overall consumer value as well as their suitability for specific kinds of consumers. Factors in our evaluation methodology include each card’s cash-back earning rates, rewards structure (such as flat-rate or bonus categories), annual fee, redemption options, promotional APR period for purchases, bonus offers for new cardholders, and noteworthy features such as insurance, loyalty bonuses or the ability to choose one’s own rewards categories.


    Summary of the best cash-back credit cards

    Card NameWhy we picked itAnnual FeeIntro Offer
    SimplyCash® Preferred Card from American ExpressHigh ongoing earn rate and top rewards on gas station spending$119.88Up to $400
    BMO CashBack® World Elite®* Mastercard®Impressive accelerated earn rates$120Up to $260
    Neo Card (Secured)Secured card with cash-back perks$0$25
    Scotia Momentum® Visa Infinite* cardLuxurious perks and outstanding cash back on groceries and PADs$120Up to $200
    RBC Cash Back Preferred World Elite MastercardExcellent flat-rate cash-back rewards$99N/A
    BMO CashBack® Mastercard®*Low rates for balance transfers$0Up to $125
    Tangerine Money-Back Credit CardFlexible reward categories$0Up to $150
    KOHO Standard Prepaid MastercardA safe option for applicants with low credit scores$0N/A
    TD Business Cash Back Visa* CardNo-fee rewards on business essentials$0N/A
    Meridian Visa Platinum Cash Back CardPlatinum-level privileges and unrivalled rewards on everyday spending$49N/A
    Triangle™ World Elite Mastercard®Earns the most Canadian Tire Money®$0N/A
    Meridian Visa Infinite Business Cash Back Plus CardCash back rewards with substantial business benefits$110N/A
    Simplii Financial™ Cash Back Visa CardGenerous restaurant rewards suitable for students and beginners$0Up to $50
    Rogers™ World Elite® Mastercard®Premium rewards on USD purchases$0$25
    Amazon.ca Rewards Mastercard®Ample rewards for online shoppers$0Up to $150
    Best Credit Cards in Canada

    Compare all different credit cards side-by-side and find out the best card that will meet your need with special perks and benefits

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    How cash-back credit cards work in Canada

    By Barry Choi and Clay Jarvis

    Before deciding which cash-back credit card is right for you, it’s helpful to understand how the cash-back redemption process works, the many categories cash-back rewards can fall into, and how cash-back cards compare to other types of credit cards.

    What is a cash-back credit card?

    Overall, cash-back credit cards are pretty straightforward. You use them as you would any other credit card, and in exchange for making eligible purchases, you get a certain percentage of what you’ve spent back in cash.

    How you get cash back with a credit card

    Earning process

    Let’s say you have a card that offers 2% cash back on groceries. If tomorrow’s weekly run to the supermarket winds up costing you $100 and you pay with your card, you’ll earn $2 in cash-back rewards. The running total of how much cash you’ve earned should be easy to find on your monthly statement or via your online account.

    It’s important to look closely at your cash-back credit card’s details to find out just how much you can earn on your purchases. Earn rates can vary based on time, such as when an introductory offer provides a higher rate of rewards and what kinds of products you purchase. Tangerine’s World Mastercard, for example, pays 2% cash back on up to three categories of items, but only 0.5% on all other purchases.

    Redemption process

    Although it’s called “cash-back,” these rewards can come in several forms

    In many cases, you can use cash-back rewards to pay down your credit card balance, but rules may apply. Some cards require you meet a minimum threshold of cash-back rewards before redemption. If you don’t have enough points available, you’ll have to sit on them until you do.

    Some bank-issued credit cards may be able to deposit cash back rewards directly into your linked savings account — a convenient way to turn rewards into actual cash.

    Pros and cons of a cash-back credit card

    Pros: Why a cash-back card may be worth it

    • Simplicity; Cash-back cards make it easy to earn valuable rewards.
    • Welcome bonuses and introductory offers can be quite generous.
    • Accumulated rewards can help pay down your card balance.
    • High earn rates for items you buy regularly can yield big rewards.

    Cons: Why a cash-back card might not be worth it

    • You may not typically buy items that yield above-average earn rates.
    • Amassing rewards can be slow depending on how much you spend each month, and whether you pay your bill in full.
    • Bonus and introductory offers tend to come with conditions, including spending minimums, which may be challenging to meet.

    Types of cash-back credit cards to choose from

    All cash-back credit cards work similarly, but even minor differences are worth noting as they can affect your earn rate.

    Flat rate

    These types of cash-back credit cards earn you the same cash back rate for all purchases made.

    Bonus categories

    Some cash-back credit cards offer an increased earn rate on select spending categories, such as groceries and restaurants.

    Flexible bonus cash back cards

    Some cards allow you to choose the spending categories on which you’ll earn your bonus rewards. By selecting categories that align with the types of items you buy frequently, you can maximize your cash back rewards.

    NerdTip: Many cash-back credit cards offer higher earn rates for only one or two spending categories. One card might pay an elevated earn rate on gas and travel while another pays extra for groceries and dining out, for example. Holding multiple cash-back credit cards that align with different categories is one strategy that can ensure you’re earning cash no matter how you spend.

    Common cash-back bonus categories in Canada

    Credit cards have merchant categories assigned by the credit card processing network. These categories are essential since many cash-back credit cards offer bonus cash back on purchases in select categories.

    For example, the Simplii Financial Cash Back Visa Card offers higher cash back rewards when you’re dining out, while the BMO CashBack World Elite Mastercard pays out more on grocery purchases.

    Knowing the different cash-back categories can allow you to maximize your earnings. Here are some of the most popular merchant categories in Canada and what they typically include:

    • Grocery. Any purchase made at grocery stores, such as Loblaws, No Frills and Metro. .
    • Restaurants. This usually includes takeout and food delivery services, such as Uber Eats, DoorDash and SkipTheDishes.
    • Travel. Airline tickets, hotels, car rentals, etc.
    • Gas. Includes any purchase made at a gas station or service station, like Shell, PetroCanada and Esso.
    • Transportation. This may include taking an Uber, a taxi, or paying for public transportation.
    • Streaming services. Monthly subscriptions to products like Netflix, Disney+, Spotify, etc.
    • Drug stores. This may include purchases made at a drug store, like Shoppers Drug Mart.
    • Entertainment. This may include money you spend on tickets to the movies, theater, or a live music concert.
    • Recurring bills. Including wireless phone, internet, and utility bills paid with a credit card.

    The key thing to understand is that each credit card defines its categories differently. For example, some cards may group gas and transportation. Some cards lump groceries and restaurants into a “food and drink” category.

    To further complicate things, some merchants don’t fall into the categories you would think they would. For example, Costco is not considered a grocery store. As far as the credit card processors are concerned, Costco is a wholesale store.

    Credit card companies do not typically reveal all of the stores associated with a merchant category publicly. Still, you should be able to contact your credit card provider’s customer service to ask about a specific store. Overall, it’s pretty easy to figure out what category your purchases will fall under, but you may need to do a little bit of trial and error.

    How cash-back bonus categories work

    You’ll earn cash back at an increased rate when making purchases in specific merchant categories, often referred to as bonus categories.

    For example, let’s say your credit card gives you 4% cash back on gas. If the card has a flat rate of 1%, this means you’ll earn cash back on gas with a bonus rate of 3%, making it so all your gas purchases would give you 4% cash back. Since many gas stations sell other things such as snacks and gift cards, you’d also earn 4% cash back on any of those items.

    Generally speaking, Canada’s best cash-back credit cards offer multiple bonus categories. Getting a cash-back card that lines up with your spending patterns can be pretty lucrative. For example, if you spend a lot on groceries, getting a cash-back credit card with an increased earn rate on groceries can significantly benefit you.

    You’ll still earn the base earn rate when you make purchases that don’t fall under a bonus category or after you have reached the bonus category cash-back limit.

    The base earn rate is different for each cash-back credit card, but it typically ranges between 0.5% – 2%.

    How to redeem your cash-back rewards

    Every credit card provider has different rules when it comes to redeeming your cash back. Some allow monthly redemption, while others pay out annually. Other providers allow redemption only after you’ve hit a certain threshold.

    The following are the payout requirements for the major cash-back credit card providers:

    • American Express. All cash back earned is paid out annually on your September statement.
    • BMO. Redeem as little as $1 in cash back as a statement credit. You can also set up automatic direct deposits to your BMO chequing or savings account starting at $25.
    • CIBC. Cash-back redemptions start at $25. Any unredeemed cash back will appear on your January statement annually.
    • RBC. Once you earn $25 in cash back, you can have the balance credited to your account at any time by calling in. Alternatively, all accumulated cash back will be credited to your account every January.
    • Scotiabank. All cash back earned appears as a credit on your November statement.
    • Tangerine. Paid monthly to your savings account or applied to your credit card balance.
    • TD. You can redeem your cash back when you have a minimum amount of $25. Another option is to take your cash back annually every January where there is no minimum amount required.

    » MORE: Read our in-depth TD Cash Back Visa Infinite Review

    When is it a good time to redeem my cash-back?

    Many cash-back credit cards will allow you to redeem your rewards as soon as they reach a minimum threshold. But you can also save them up over time and cash them in for a more significant, single-shot pay-down of your credit card balance, for example.

    Choosing to redeem cash rewards on a regular basis is certainly satisfying. But it could mean dipping below your minimum threshold. The next time you want — or need — to use your rewards, you may not have enough at your disposal.

    Saving your cash back rewards to generate more impact — say, to ease the blow of a particularly big purchase — is a worthy strategy, too. But know that if you fail to keep your account in good standing or decide to close it suddenly, you could lose out on accumulated rewards.

    How to choose a cash-back card

    With dozens of cash-back credit cards available, comparing them all can be time-consuming. That said, there are a few things you should look at when considering any cash-back card.

    Interest rates

    It’s important to look closely at the interest rates associated with any cash-back credit cards you’re considering; many start out in the 19.99% range. Zero interest is charged on balances paid in full every month, but if you don’t, it can significantly add to your debt and erode the benefit of any cash-back rewards you earn.

    If you don’t typically pay your credit card balance in full each month, you may want to seek out a cash-back credit card with a 0% introductory rate offer, or low ongoing interest rate.

    Annual fee

    Decide if you want to pay an annual fee or not. In most cases, paying a yearly fee means you’ll earn more cash back and get better benefits. On the other hand, no-fee cash-back cards may have a lower earn rate, but if you don’t charge much to your card, you could come out ahead compared to a card with a fee.

    Some of the best cash-back cards in Canada with no annual fees include the Tangerine Money-Back credit card and the Simplii Financial Cash Back Visa card.

    Welcome bonus or intro offer

    Cash-back credit cards in Canada commonly offer a sign-up bonus for new applicants. The welcome bonus usually comes in the form of a higher cash-back rate for a set period. For example, you might get 10% cash back on all purchases up to $3,000 in spending. If the earn rates are similar with two cards, but one has an excellent welcome bonus, then you might as well take advantage of the promotion.

    The BMO CashBack World Elite Mastercard and CIBC Dividend Visa Infinite Card are two selections on our best cash-back credit card list with intro offers worth hundreds of dollars, for example.

    Credit card bonus offers nearly always come with terms and conditions to be met, however, so be sure you read over the offer thoroughly and understand how much you may need to spend in order to qualify.

    Bonus categories

    The increased earn rate on bonus categories is arguably the most critical factor when comparing cash-back cards. It’s ideal to choose a card that gives you increased cash back on the categories where you do the most spending.

    Take the Desjardin Cash Back World Elite Mastercard, for example, which offers 4% cash back on groceries, 3% on restaurants, entertainment and public transportation, and 1% cash back on everything else. This could be a great card for someone who enjoys cooking at home as well as dining out, because they’d a high rewards rate whether shopping for recipe ingredients or trying out a new brunch place.

    Keep in mind that the amount you spend in bonus categories every year could potentially earn you more than any welcome bonus offered.

    Credit card insurance

    Many cash back credit cards offer various forms of insurance as an added perk.

    While helpful, some of these offers occupy the more basic end of the insurance spectrum: rental car insurance, mobile device insurance and extended warranties on the items you purchase.

    But some cards, like the Scotia Momentum Visa Infinite Card, for example, offer more robust insurance options, like out-of-province/out-of-country emergency medical insurance for the first 15 days of a trip.

    Additional benefits

    Many cash-back credit cards come with additional benefits that may appeal to you.

    Some perks to look out for include

    » NerdWallet's top choices: Canada's best credit cards for June 2022

    How to apply for a cash-back credit card

    Even though the benefits of a cash-back credit card are relatively simple to understand, you’ll still have to reckon with a few eligibility requirements to be approved for one.

    Age and residency status

    Most cash-back credit cards require you to be both a Canadian resident and the legal age of majority in the province where you live to apply for your own card.

    The age of majority is 18 in Alberta, Manitoba, Ontario, Prince Edward Island, Quebec and Saskatchewan. It’s 19 everywhere in all other provinces.

    Credit score

    A good credit score is required in most cases to qualify for a cash-back credit card. In Canada, a credit score that ranges between 660 and 724 is considered good.

    If you do not have a good credit score, consider a credit card designed for bad or no credit, a prepaid card, or a secured credit card instead of a cash-back credit card.

    Personal or household income requirements

    Some cash-back credit cards come with relatively lower income requirements. Tangerine’s Money Back Credit Card, for example, only requires an annual income of $12,000.

    But if you want a higher-tier cash-back credit card, you’ll need a higher income. For example, World Elite cards require a personal income of $80,000 or a household income of $150,000.

    Cash-back vs points: which is better?

    Answering this question depends on what you’re looking to get out of your credit card card.

    If you’re hoping for a little help paying your credit card bills, cash back may be the route to take. Cash-back rewards are typically easy to calculate, collect and apply toward your balance.

    On the other hand, credit card points can generally be redeemed in a wider variety of ways, including discounts on travel or merchandise. That flexibility can be very attractive to some consumers. However, the value of the points you collect can fluctuate, making tracking your points a more complicated endeavour than cash back rewards.

    Cash-back vs rewards: which is better?

    There are two situations where a cash-back card might not be the right choice. The obvious case is when the cash back you can earn is less than what you’ll pay in annual fees.

    The other time when a cash-back card might not be worth it is if you can get a better return with a rewards credit card instead. For example, let’s say you got a travel rewards credit card and did the same spending. Would the points you earn be worth more than the cash back you could potentially earn? If so, it makes more sense to get a travel credit card.

    How to maximize your cash-back credit card

    There are plenty of tricks to help you get the most out of your cash-back credit cards. The more tips you adopt, the more cash back you’ll earn. That said, it’s best only to follow the advice that you’re comfortable with.

    Apply for a new card ahead of major expenses

    Since many of the best cash-back credit cards in Canada have a generous welcome bonus, it’s often worth your trouble to apply for a new card before you make a major purchase.

    For example, let’s say you need to renew your home and auto insurance, which will cost you about $2,000. You could apply for a cash-back credit card that offers you 10% cash back as the welcome bonus. Then, when you charge your insurance to your card, you’d get $200 back.

    Keep in mind that many cash-back credit cards have a limit on their sign-up offer. If you have a substantial purchase, you could apply for more than one card and split up your purchase to maximize your cash back. However, if you need to pay an annual fee for the new card, it may negate the cash back you earn, so pay attention to the details.

    Pay attention to the sign-up bonuses

    Welcome offers are constantly changing, so watch for any current promotions. Getting 10% cash back for a set period is generous, but if the card also waives the annual fee for the first year, they’re practically paying you to sign up. When you get close to 12 months of card membership, you might cancel the card before your annual fee posts. You could then apply for a new cash-back credit card with a good sign up bonus.

    Carry multiple cards

    Many people focus on a single cash-back credit card, but there’s nothing wrong with having multiple credit cards. In fact, having more than one card is the easiest way to maximize your cash back. Start off with a primary card that gives you an increased earn rate where you do most of your spending. You could then complement that card with a no-fee card that gives you bonus categories where your primary card doesn’t. Just use the credit card that gives you the most cash back whenever you shop.

    Buy gift cards in bonus categories

    Groceries and gas are two of the most popular merchant categories where you’ll earn additional cash back. Here’s the thing: both grocery stores and gas stations sell gift cards that can be used at many retailers. That essentially allows you to earn extra cash back.

    For example, let’s say your credit card gives you 5% cash back at grocery stores. You could purchase gift cards at a grocery store for restaurants, Amazon, streaming services, drug stores and gas. That would guarantee you 5% cash back. When you need to make purchases at those merchants, use the gift cards you already purchased.

    Add supplementary users

    Most credit cards allow you to add supplementary users. The advantage here is that all authorized cardholders also earn cash back on their purchases, including any bonus. Best of all, the cash back gets combined into a single pool, so you’ll be racking up that cash back in no time.

    Use cash-back websites

    Various online sites allow you to earn additional cash back whenever you shop online. First, you need to create an account. Afterwards, you would select the partner retailers through their online portal. When you do your shopping, eligible purchases will earn you cash back. If you pay with your cash-back credit card, you’d be earning cash back twice. That’s right, you can double dip without much work.

    Cash-back credit card companies in Canada

    Here are some widely known credit card issuers in Canada, along with their networks and notable cash-back cards.

    Credit Card Issuer NetworkNotable Cash-Back Cards
    American ExpressAmerican ExpressSimplyCash® Preferred Card from American Express
    ATBMastercardATB Gold Cash Rewards Mastercard®
    BMOMastercardCash-Back: BMO CashBack® World Elite® Mastercard®
    Brim FinancialMastercardBrim World Elite Mastercard
    Canadian TireMastercardTriangle™ World Elite Mastercard®
    Capital OneMastercardSavorOne Rewards for Good Credit
    CIBCVisaCash-Back: CIBC Dividend® Visa Infinite Card
    Coast Capital SavingsVisaSavorOne Rewards for Good Credit
    DesjardinsVisa & MastercardDesjardins Cash Back World Elite® Mastercard®
    Home TrustVisaHome Trust Preferred Visa
    HSBCMastercardHSBC Cash Rewards Mastercard
    ManulifeVisaManulifeMONEY+ Visa Infinite
    MBNAMastercardMBNA Smart Cash Platinum Plus® Mastercard®
    MeridianVisaMeridian Visa Infinite Cash Back Card
    National BankMastercardmycredit Mastercard
    Neo FinancialMastercardNeo Rewards™ Money back credit card
    PC FinancialMastercardPresident's Choice Financial® World Elite Mastercard
    PlastkVisaPlastk Secured Rewards Card
    RBCVisa & MastercardRBC Cash Back Preferred World Elite Mastercard
    Refresh FinancialVisa-
    RogersMastercardRogers™ World Elite® Mastercard®
    ScotiabankVisa & American ExpressScotia Momentum® Visa Infinite Card
    Simplii FinancialVisaSimplii Financial™ Cash Back Visa Card
    TangerineMastercardTangerine Money-Back Credit Card
    TD BankVisaTD Cash Back Visa Infinite Card
    VancityVisaenviro Visa Infinite* card
    WalmartMastercardWalmart Rewards World Mastercard

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    FAQs for Canada’s cash-back credit cards

    Are there cash back limits?

    Most cash-back credit cards have limits on the cash back you can earn. Look at your card’s terms and conditions to find the rates and limits. Most cash-back credit cards set the limit per category, but they may also lump some categories together. Additionally, the limit would factor in any purchases made by supplementary users on the account.

    Some cards give you unlimited cash back, even on bonus categories. That means you would get the full earn rate, regardless of how many purchases you put on your card. Shopping around and reviewing the terms and conditions of cards you’re interested in, will help you pick the right card.

    Is cash back from credit cards taxable income?

    Cash back rewards are considered a rebate/discount by the Canada Revenue Agency, so you won’t be taxed. Cash back is really no different from a coupon, which is obviously not taxable.

    That said, if you earn cash as part of your employment, it may be taxable. For example, let’s say you have a company cash-back credit card. Your employer allows you to deposit the cash back earned directly into your bank account. In this case, the cash back would be taxable since it’s a form of income.

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