If you’ve just received a bank deposit with the description “Canada Fed,” you’re not alone. Other eligible Canadians and I have been receiving the same deposit over the years.
But like you, many recipients are scared and confused about the reason behind the Canada Fed deposit. This is because spending government money can land anyone in trouble.
In this guide, I covered everything you need to know about the Canada Fed deposit.
Let’s get started.
What is Canada Fed Deposit?
Canada Fed deposit is a direct payment from the federal government of Canada to eligible persons as a tax refund, rebate or credit. It consists of three tax credits which are:
- Canada Child Benefit (CCB).
- Goods and Services Tax (GST)/Harmonized Sales Tax (HST).
- Canada Workers Benefit (CWB)
How much Canada Fed deposit you receive depends on your eligibility on the above credits.
The main objective of this Canada Fed deposit is to improve the purchasing power of low-medium-income Canadians through tax rebates or credits.
Consequently, eligible persons are not taxed upon receiving this deposit, with the exception of the Canada Workers Benefit (CWB) deposit.
This is the major thing pro about the Canada Fed deposit. Unlike other government deposits, you have the flexibility to spend this payment without worrying about taxes.
Canada Fed Deposit: Three-in-One Benefits Explained
As mentioned earlier, the Canada Fed deposit consists of three-in-one benefits from the federal government, which the Canada Revenue Agency administers.
However, you must not qualify for all three benefits to receive the Fed deposit. You only need to be eligible for one.
Here I discuss each of the components of the Canada Fed deposit.
1. Canada Child Benefit (CCB)
CCB is a federal government program designed to assist low-medium-income families in raising their children in Canada.
However, this tax-free credit can be paid to eligible Canadians with the description “Canada CCB” or “Canada Fed.”
So whether you received it as “Canada CCB” or “Canada Fed,” it means the same thing.
Accordingly, you could receive a CCB credit of up to $6,765 annually for each of your children below six years of age.
If you have children that are between 6 to 17 years old, you could receive up to $5,708 annually for each child.
Additionally, you may receive child disability benefits and other provincial/territorial programs under the CCB.
For more information about the CCB, such as eligibility, application and entitlement, click here.
2. GST/HST Credit
Goods and Services Tax (GST) or Harmonized Sales Tax (HST) is a tax-free credit aimed at offsetting Canadian goods and services sales.
Like the CCB, GST/HST is also deposited by the CRA to low-medium-income Canadians.
Depending on your province/territory, you may benefit from other provincial/territorial programs under the GST/HST deposit.
That said, your family income, the number of registered children and previous tax return determines how much GST/HST credit you receive.
For the 2020 tax year, a single person may receive up to $456.
For more information about the GST/HST credit, such as eligibility, applications, and entitlement, click here.
3. Canada Workers Benefit (CWB)
CWB is a credit available to less wealthy families and individuals in Canada.
However, unlike CCB and GST/HST credit, the CWB is tax refundable.
So you must first file your tax return to be entitled to the CWB.
Under the CWB, you can benefit from a basic amount and a disability supplement.
If you’re single without a child, you may receive up to $24,573 while residing in any province/territory in Canada except Alberta, Quebec, and Nunavut for the 2020 tax year.
However, you may receive up to the following amounts if you’re residing in:
- Quebec – $23,904.11
- Alberta – $25,793
- Nunavut – $48,779
Depending on your option, you can get a one lump-sum CWB deposit or a quarterly advance deposit.
For more information about the Canada Workers Benefit (CWB), such as eligibility, application and entitlement, click here.
Who Receives the Canada Federal Payment?
As I mentioned earlier, the federal payment is administered by the CRA to eligible Canadians under the CCB, GST/HST and CWB programs.
So to be eligible for the federal payment, an individual must meet the requirements of any of the above programs.
However, each of the above programs has different requirements, but it’s not surprising to qualify for all of them.
Here are the common requirements for the CCB, GST/HST and CWB programs:
- Be a Canadian resident
- Reach the age of majority in your province/territory
- File your tax return
- Have a Canadian bank account
How Much is Canada Fed Deposit?
The amount of Canada Fed deposit you get depends on how many programs you qualify for and your situation.
As mentioned earlier, you could get a CCB deposit of up to $6,765 annually for each of your children below six years of age.
But if you have children that are between 6 to 17 years old, you could get a CCB deposit of up to $5,708 annually for each child.
For the 2020 tax year, a single person may receive up to $456 under the GST/HST credit.
However, suppose you’re single without a child. In that case, you may receive up to $24,573 CWB credit while residing in any province/territory in Canada except Alberta, Quebec, and Nunavut for the 2020 tax year.
What are the Canada Fed Deposit Payment Dates?
Since the Fed deposit comprises three programs, you should expect to receive each deposit on different dates.
However, GST/HST and CWB advance payments are made quarterly. But you can choose to receive a one lump-sum CWB payment during tax periods.
That said, the table below shows the different dates for CCB, GST/HST and CWB advance payment for 2021:
|CCB Payment Dates||GST/HST Payment Dates||CWB Advance Payment Dates|
|May 20, 2021|
June 18, 2021
July 20, 2021
August 20, 2021
September 20, 2021
October 20, 2021
November 19, 2021
December 13, 2021
|January 5, 2021|
April 1, 2021
July 5, 2021
October 5, 2021
|January 5, 2021|
April 1, 2021
July 5, 2021
October 5, 2021
What to Do After Receiving the Canada Fed Bank Deposit?
If you want to avoid troubles in the long run, you should ascertain the purpose of the Canada Fed bank deposit immediately after receiving it.
Occasionally, the federal government makes wrong deposits. Although it’s not your fault, you may put yourself in serious trouble if you fail to inform them about the wrong deposits.
Thus, to validate the purpose of the Fed deposit, log in to your CRA My Account. This is where you will find all notices concerning your eligible credits and payment dates.
However, you may go to the message area to check whether the CRA has sent you any message regarding the Fed deposit.
If you have not received any notice or message regarding the Fed deposit and are not qualified for either CCB, GST/HST or CWB credit, reach out to the CRA immediately.
Moreover, you’re free to spend the Fed deposit if you meet the requirements for the CCB, GST/HST or CWB credit and find notification or a message about the deposit on your CRA My Account.
Proven Tips on Spending the Canada Fed Deposit
When I received my first Canada Fed deposit, I didn’t invest much time on how to spend it.
Yes, I’m free to spend it the way I like without worrying about taxes (except the CWB deposit).
Besides, it’s just a few hundred dollars, so I just used it to supplement my grocery expenses.
However, after realizing how much I could have contributed to my emergency fund with the total Fed deposit in a year, I regret my initial mistake.
The truth is, federal government deposits can only achieve their aim when used judiciously by the beneficiaries.
Even though they are not much, you can use them to supplement your savings or investment toward achieving long-term financial security.
But if you’re looking for a customized solution on attaining financial freedom, don’t hesitate to contact a financial advisor.
Additional Bank Deposit from Canada Federal Government
CCB, GST/HST and CWB are just a few out of many federal government deposits in Canada.
As a low-medium-income Canadian, it’s essential to know about these deposits and prepare to claim them.
Here are two other federal government deposits you should know about:
1. Canada RIT
Canada Refund Income Tax (Canada RIT) is a rebate administered by the Canada Revenue Agency (CRA) to those filing their taxes in Canada.
The payment could take a few days or weeks after annual tax filing by individuals or businesses.
However, you may receive the Canada RIT deposit after a reassessment of your taxes.
The Canada RIT does not have a set amount. As a result, the amount you get may range from a few thousand to a few hundred dollars.
Moreover, you can spend this credit on anything you choose tax-free.
For more information about the Canada RIT deposit, such as eligibility, application, payment dates and entitlement, click here.
2. Canada Pro
This credit is designed for qualified Ontario and Alberta residents.
As such, eligible Ontario residents receive the Canada Pro deposit under the Ontario Trillium Benefit (OTB) program.
On the other hand, eligible Alberta residents receive the Canada Pro deposit under the Alberta Child and Family Benefit (ACFB).
So depending on your entitlement, you may receive a one lump-sum Canada Pro deposit or a monthly deposit on your bank account.
For more information about the Canada Pro deposit, such as eligibility, application and payment dates, click here.
Final Thoughts on Canada Fed Payment
Now you have a clear picture of what the Canada Fed payment on your bank account entails.
Also, you know why it’s essential to confirm the purpose of the deposit on your CRA My Account before spending it.
Ensure that you’re really eligible for this deposit, else those few hundreds or thousands of dollars may put you into a costly problem.
That said, even though you’re free to spend the money as you want without bothering about taxes (except the CWB deposit), you can learn from my experience and invest it in things that matter.
Furthermore, other federal government deposits such as Canada RIT and Canada Pro can add up to building your long-term financial security.
Now you can take the next step of confirming your eligibility and claiming all your entitlement benefits.
All the best!
FAQs on Canada Fed bank Deposit
Is Canada Fed Deposit Taxable?
No, Canada Child Benefit (CCB) and the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) are tax-free, excluding the Canada Workers Benefit (CWB) deposit.
This means you will have to include the CWB deposit while filing your taxes, excluding CCB and GST/HST deposit.
What is Canada Fed Deposit in My Bank Account?
This is because you meet the qualifications of either the Canada Child Benefit (CCB), Goods and Services Tax (GST)/Harmonized Sales Tax (HST), Canada Workers Benefit (CWB) or both.
So the deposit is administered by the CRA as a tax refund or credit of your previous tax return.
Why Did I Get Canada Fed Deposit $600?
You will get a Canada Fed deposit of $600 as an additional CCB Payment in 2021 if your family net income is $120,000 or below. This is the maximum CCB additional payment you will get in 2021 as a relief for the COVID-19 pandemic.
However, families whose net income exceeds $120,000 are not qualified for the CCB additional payment in 2021.
To learn more about the CCB 2021 additional payment, click here.
If you’ve more questions about the Canada Fed deposit, let me know in the comment section.