Money in Canada

The currency in Canada is based on the Canadian Dollar (CAD) and since late 2007 has hovered around a level of parity with the U.S. dollar (1 CAD = 1 USD).

The coins in circulation are: 1¢ (penny), 5¢ (nickel), 10¢ (dime), 25¢ (quarter), 50¢ (very uncommon), $1 (loonie) and $2 (toonie).

The bank notes are colour-coded and include: $5 (blue), $10 (purple), $20 (green), $50 (red) and $100 (brown). There are also $1000 notes that are pinkish in colour but are being phased out in an effort to stop money laundering.

Currency exchange

It is relatively easy to exchange money between most major currencies in Canada. U.S. dollars are widely accepted at many retail outlets, even in rural areas, but they are not under any obligation to give you market rates of exchange on your purchase.

When converting your money to Canadian dollars, look around for private bureaus which will usually offer better exchange rates than the banks.

Bargaining

Canada is not a bargaining country and you will find the practice extremely rare in day to day shopping. If you're used to this custom, you need not worry, the market is very competitive so you can be sure to get fair prices on just about everything.

High-end purchases such as vehicles or electronics may be secured for less than the ticketed price if the sales people work on commission.

Large retailers may offer a price guarantee where they will match or better the price of a competitor. You will usually need to prove the price on offer by showing them an advertisement of the item you wish to purchase.

Banking

Canada has an advanced banking system that is well established and includes a widespread network of Automatic Teller Machines (ATMs) to easily withdraw money. Payment can be made almost everywhere by an ATM bank card and many Canadians depend solely on their cards for making cashless payments.

Visa and MasterCard are accepted in most places and some will also accept American Express and Diners Club cards for payment.

Taxes

When making purchases in Canada, be aware that the ticketed price does not include sales tax which will be added on top. Some exceptions to this are medical services, gasoline, liquor from liquor shops and parking fees.

The sales tax is called a Goods and Services Tax (GST) and is set at 5%. There will usually be another tax called a Provincial Sales Tax (PST) added on top which can make it difficult to know the true cost of your purchase if you're not a local. Some provinces make it easier by combining the two taxes into one Harmonized Sales Tax (HST).

Below is a list of various provinces and their current total tax rates:

Alberta - 5% total
British Columbia - 12% total
Manitoba - 12% total
New Brunswick - 13% total
Newfoundland and Labrador - 13% total
Northwest Territories - 5% total
Nova Scotia - 13% total
Nunavut - 5% total
Ontario - 13% total
Prince Edward Island - 15% total
Quebec - 12.875% total
Saskatchewan - 10% total
Yukon - 5% total.

Photo credit: Rick from Flickr.