How to Choose a Cash Back Credit Card in Canada

For those of us who are looking to get rewarded when we spend, but without having to learn about saving and redeeming points, cash back credit cards are a great solution.

Cash back credit cards offer a simple, straightforward earning structure and guaranteed value, making it easy to track and enjoy your savings.

In this article, we’ll introduce 5 of our favourite cash back credit cards in Canada, and give you some side-by-side comparisons and spending examples to help you choose the best possible card. Looking for our full monthly roundup of offers instead? Check out the best cash back credit cards this month.

How to Choose the Right Cash Back Card

With so many credit card options available, it can sometimes feel overwhelming trying to figure out exactly which card is best for you.

Key Considerations

To choose the right cash back card for your financial situation and spending habits, there are a few key things to consider:

Best Cash Back Credit Cards in Canada

Now, with the above characteristics in mind, let’s take a look at our picks for the best cash back credit cards in Canada and their key details:

In addition to all the cash back earning opportunities and benefits that we’ll mention below, each of these cards also typically offers a valuable welcome offer to amp up your savings as soon as you start spending.

Tangerine Money-Back Credit Card

The Tangerine Money-Back Credit Card comes with no annual fee and a low minimum income requirement of $12,000 personal income.

This card is unique among its peers because you get to customize your earning categories to best suit your spending habits.

Earning and Redeeming

With the Tangerine Money-Back Credit Card, you earn cash back on your purchases as follows:

You can also change your 2% earning categories every 90 days to adapt to any changes in your spending habits. The spending categories that you can choose from are:

The cash back you earn with the Tangerine Money-Back Credit Card is then deposited automatically every month either as a credit card statement or to your Tangerine Savings Account.

Card Benefits

The Tangerine Money-Back Credit Card doesn’t offer much in the way of added benefits, though it is in line with many no-annual-fee cards.

As a cardholder, you get a 15% discount at H&R Block, plus extended warranty and purchase protection coverage.

Who’s the Card Best For?

The Tangerine Money-Back Credit Card is good for someone who’s after a no-annual-fee card, or those with a lower income, like a student or someone who’s only working part-time.

It’s also a helpful card if you know that you mostly spend your money in 2 or 3 specific categories, or if you can take advantage of the ability to switch up the categories to match upcoming expenses. For example, if you know you have a big trip abroad and switch to the Foreign Currency Spend category, or you have a large home project and switch to the Home Improvement category.

SimplyCash^® Preferred Card from American Express

The SimplyCash^® Preferred Card from American Express has a monthly fee of $9.99, except in Quebec, where the fee is $119 charged annually. The card also has no minimum income requirement, making it fairly accessible.

Earning and Redeeming

With the SimplyCash^® Preferred Card from American Express, you can enjoy elevated cash back earning in two categories and a strong base rate on all other purchases:

Take note that for the grocery earning category, the 4% cash back rate is available on the first $30,000 you spend each year, which is equivalent to $1,200 in cash back. After you hit this limit, the earning rate in this category becomes 2% for the rest of your account year.

In terms of receiving your cash back: it’s automatically distributed once a year and will show up on the credit card statement you receive in September. Your balance will then reset.

Card Benefits

The SimplyCash^® Preferred Card from American Express comes with a number of valuable benefits, including:

Who’s the Card Best For?

The SimplyCash^® Preferred Card from American Express is ideal for someone whose biggest spending categories are gas and groceries, and who shops at a grocery store that accepts American Express.

The card’s lack of a minimum income requirement also makes it quite accessible—as long as you’re okay with paying an annual fee.

It can also be a very useful addition to your wallet if you can make use of the Amex Offers and Amex’s array of event/experience benefits.

Scotiabank Momentum^® Visa Infinite +* Card

The Scotiabank Momentum^® Visa Infinite +* Card is a good cash back Visa option for people whose biggest spending categories include gas and groceries.

This card comes in with an annual fee of $120 (which is often waived), and a minimum income requirement of $60,000–80,000 individual or $100,000–150,000 household, making it accessible to many.

Earning and Redeeming

With the Scotiabank Momentum^® Visa Infinite +* Card, you can enjoy the following elevated earning rates across key spending categories:

Your earned cash back can be redeemed at any time as long as you have the minimum redemption amount of $25 (though smaller amounts are allowed at the bank’s discretion).

Redemption requests are easily made through the Scotiabank app or website, and you can have your cash back deposited as a statement credit on your Momentum card or into your eligible Scotiabank chequing or savings account.

Card Benefits

The Scotiabank Momentum^® Visa Infinite +* Card also gives cardholders a number of notable perks, including:

Who’s the Card Best For?

The Scotiabank Momentum^® Visa Infinite +* Card is a great card choice for someone who spends frequently on groceries and gas and would like the convenience of a Visa card.

Offering similar earning rates (though ever-so-slightly lower) to the SimplyCash^® Preferred Card from American Express above, but with the wider acceptance of Visa, the Scotiabank Momentum^® Visa Infinite +* Card is another great way to save on key expenses each month.

This card is also a solid choice for a traveller who’s looking to save on gas for their road trip, and on travel insurance, car rental insurance, and data for a trip abroad.

BMO CashBack^® World Elite^®* Mastercard^®*

The BMO CashBack^® World Elite^®* Mastercard^®* is an excellent premium card, offering the highest cash back rates of this comparison.

The card has an annual fee of $139 and a minimum income requirement of $80,000 individual and $150,000, which is standard for World Elite Mastercards.

Earning and Redeeming

The BMO CashBack^® World Elite^®* Mastercard^®* earns cash back in a tiered structure, with spending caps on the elevated categories:

Once you’re ready to cash in your rewards, you can request one-time cash back deposits of as little as $1, via the BMO app or website. You can also set up a recurring redemption of $25 or more that will be deposited monthly (if there’s sufficient cash back available) 2–5 business days after your statement cycle ends.

Cash back will be deposited into your eligible BMO chequing, savings, or InvestorLine account, or as a statement credit on your card.

Card Benefits

With the BMO CashBack^® World Elite^®* Mastercard^®*, you can take advantage of the following perks:

Who’s the Card Best For?

The BMO CashBack^® World Elite^®* Mastercard^®* is a solid choice if you want to enjoy high cash back earning rates and your monthly spending fits within the card’s capped amounts in each spending category.

The card also offers helpful travel perks like travel insurance coverage, discounts on car rentals, and airport benefits, which make it attractive to any traveller looking to save money and enjoy some extra comfort.

How Much Cash Back Can You Earn?

With so many categories and variants around earning rates, it can be difficult to sort out which card is REALLY best for you.

To help get a realistic sense of the cash back you could earn, let’s look at a couple of monthly spending examples to see what you might expect.

Example 1 – Family of Four

For this first example, let’s see how much cash back a family of four might earn each month, with groceries as their largest expense and lots of money being spent in the « all other purchases » category:

Example 2: Urban Couple

For this second example, let’s look at the potential cash back for a couple in the city with no car, who go out to restaurants/bars a few times a week:

Card Comparison

Now, to bring together much of what we’ve covered above, let’s compare key aspects of our 5 cash back card choices in one spot:

*These annual fees are often waived as part of the welcome offers.

Bottom Line

Cash back credit cards are a great way to enjoy simple and straightforward rewards on all your day-to-day expenses.

By adding a cash back credit card to your wallet, you can enjoy guaranteed savings every time you make a purchase, keeping more of your hard-earned money in your pocket.

Right now, take advantage of an exceptional offer on the Scotia Momentum Visa Infinite +* Card: 15% cash back and a first year with no annual fee.

To learn more ways to save money on groceries, at the gas station, and on other regular expenses, check out our other guides and articles below.

To compare every option on the market, also check out our page of the best credit cards in Canada. And to receive our analyses every week, sign up for our newsletter.

FAQs

Who should use a cash back credit card?

Cash back credit cards are great for anyone who wants to save money on all their expenses without having to navigate a rewards program.

Cash back credit cards provide simple, straightforward earnings with a guaranteed redemption value.

How do I redeem my cash back?

Each credit card has its own way of redeeming its cash back. Some cards give you your cash back automatically each month or once a year, while others wait until you request that the money be released.

Additionally, some cards only let you use the cash back for statement credits, and others let you choose between this and depositing your earnings into an eligible bank account.

What’s the single best cash-back card in Canada for most households?

For households spending $30,000+ per year, the BMO CashBack World Elite Mastercard typically wins thanks to:

• 5% on groceries (cap: $500/month)
• 4% on transit (cap: $300/month)
• 3% on gas and EV charging (cap: $300/month)
• $139 annual fee, often waived first year + welcome offer up to $480

Lower-spending or fee-averse households should consider the Tangerine Money-Back Credit Card with 2% on two custom categories and no annual fee. The Scotiabank Momentum Visa Infinite + is the closest premium competitor at 4% groceries / 4% recurring bills with broader Visa acceptance.

Are cash-back rewards taxable in Canada?

For personal use, cash-back rewards are not taxable in Canada. The CRA treats them as a discount on purchases rather than income. This applies whether the cash back is paid as a statement credit, deposit, or applied to an investment account.

Caveats:

• If a business earns cash back on a corporate card and uses it personally, it can become a taxable benefit
• Sign-up bonuses from referral programs (cash for referring friends) are taxable as miscellaneous income
• Cash back redeemed against business expenses generally reduces deductible expenses dollar-for-dollar

Consult a tax professional for borderline cases involving business cards or complex household structures.