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Canadian Credit Card Rewards for Beginners

By PointsExplainedLast reviewed

Pick a reward type

If you want simplicity, start with cash back. If you want travel, look at how a program prices the flights or hotels you would actually book before choosing a points card.

Match the categories to your spending

Check which categories your biggest expenses fall into, remembering that the merchant's category code, not the item you buy, decides the category.

Weigh the fee against the rewards

Estimate a year of rewards and subtract the annual fee, as FCAC suggests.

Pay in full every month

Interest on a balance you carry can outweigh the rewards you earn.

Compare before you redeem

Check what the same points buy in each redemption option; values differ even within one program.

Where this comes from

Sources

The documents this guide relies on. If one has changed since we read it, the document is right and this guide is out of date.

  1. Office of Consumer Affairs (ISED) - Reward and customer loyalty programs

    Most credit cards have reward programs issuing general points, travel points, retail credits or cash back; descriptions of each; rewards cards often carry higher interest rates and fees that may cancel out rewards; pay in full each month; points in multi-retailer programs may expire; compare the value of a reward with points traded in.

    ised-isde.canada.ca · Accessed
  2. FCAC - Choosing a credit card (page dated 2025-10-15)

    1% cash back on $4,800 = $48 against an $85 fee (-$37); grocery example with a $25 fee and 10,000 points per $10 (benefit $15); fee cards usually offer extra rewards/benefits or a lower rate; some no-fee cards offer similar rewards.

    canada.ca · Accessed
  3. Amex Bank of Canada - Membership Rewards Program Terms and Conditions (PDF, form 50451591 (04/25))

    Different redemption options may have different values; 1,000 points = $10 travel credit; gift cards at 130 points per $1 (Amex gift cards 125); applying for multiple cards, cancelling or downgrading may be treated as abuse; at least 60 days' notice of changes not to your advantage; there may be tax implications and you are responsible for your tax obligations.

    americanexpress.com · Accessed
  4. PC Optimum - Program Terms and Conditions (current as of August 1, 2026)

    10,000 PC Optimum points are worth $10 in rewards at Participating Stores (terms current as of August 1, 2026).

    pcoptimum.ca · Accessed
  5. Scene+ Help Centre - How do I earn and redeem Scene+ points at grocery, convenience, and pharmacy?

    1,000 Scene+ points for $10 off groceries at participating stores.

    help.sceneplus.ca · Accessed
  6. Tangerine - Merchant Category Codes for Tangerine credit cards

    Each purchase is assigned a merchant category code by the merchant's payment processor; categories are based on MCCs; Tangerine doesn't determine how merchants are categorized.

    tangerine.ca · Accessed
  7. FCAC - How credit cards work (page dated 2025-10-15)

    Minimum 21-day interest-free grace period at federally regulated institutions; no grace period for cash advances, cash-like transactions and balance transfers.

    canada.ca · Accessed
  8. FCAC - Using your credit card responsibly (page dated 2025-10-15)

    Interest from the date of purchase if the balance isn't paid by the due date.

    canada.ca · Accessed
  9. Aeroplan - General Terms and Conditions

    Aeroplan may limit the number of New Card Bonuses a member may receive.

    aircanada.com · Accessed
  10. FCAC - Improving your credit score (page dated 2026-07-01)

    Credit card applications are hard inquiries that affect your score; too many close together may suggest urgently seeking credit or spending beyond your means; apply only when needed and avoid multiple applications at once.

    canada.ca · Accessed
  11. Canada Revenue Agency - Loyalty or other points programs

    Administrative policy: points collected by the employee on employer-reimbursed expenses are not a taxable employment benefit when redeemed if not controlled by the employer, not converted to cash, not an alternative form of remuneration and not for tax avoidance.

    canada.ca · Accessed
Questions

About this guide

What's the easiest rewards card for a beginner?

One that doesn't require redemption decisions. Cash back returns a percentage of eligible spending, so its value is clear. Current cards are listed at /ca/credit-cards/cash-back and /ca/credit-cards/no-annual-fee.

Do credit card rewards actually save you money?

Only if you pay your balance in full. The Office of Consumer Affairs notes that interest on a balance you carry may outweigh the benefits of a rewards program, and FCAC says an unpaid balance is charged interest from the date of each purchase.

How many credit cards should a beginner have?

There's no set number. FCAC's advice is to apply for credit only when you need it and to avoid sending several applications at once or too close together, because each application is a hard inquiry on your credit report.

Are credit card rewards taxable in Canada?

We don't give tax advice. The CRA guidance we cite covers one situation: points employees earn on employer-reimbursed business expenses. Under the CRA's administrative policy, redeeming those points isn't a taxable employment benefit if the employer doesn't control them, they aren't converted to cash, and the arrangement isn't a form of pay or tax avoidance. American Express's Membership Rewards terms also say there may be tax implications and that you are responsible for your own tax obligations. For your situation, ask the CRA or a tax professional.
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