What is a Canada RIT Deposit?

Ever checked your bank account and spotted a deposit labelled "Canada RIT" but weren't quite sure what it was? Good news—that's your tax refund!

RIT stands for "Refund of Income Tax." You might also hear people call it "Return Income Tax." When it shows up on your bank statement, it might appear as a RIT/RIF transaction.

This isn't free money or a surprise gift from the government (although it can certainly feel that way!). It's actually your own money coming back to you. Throughout the year, you pay income tax through deductions from your paycheques. Sometimes, you end up paying more than you actually owe.

Why would you get money back? It could be for several reasons:

• You had too much tax withheld from your paycheques

• You claimed deductions or credits on your tax return

• Your circumstances changed during the year (like having a baby or going back to school)

The size of your refund depends on your specific situation—how much you earned, what deductions you claimed, and your personal circumstances.

So when that Canada RIT deposit hits your account, celebrate a little! It's your hard-earned money finding its way back home.

When are Canada RIT deposits made?

Wondering when your tax refund will show up in your account? There's no single calendar date when everyone gets their Canada RIT deposit. The timing depends on a few key factors:

• When you filed your tax return

• How you filed (online vs paper)

• Whether the CRA needs to review your return more carefully

How long will you wait?

If you filed online using EFILE or NETFILE, you'll likely see your refund within about two weeks.

Filed the old-fashioned way by mailing a paper return? You'll need a bit more patience—expect to wait around eight weeks.

If the CRA selects your return for a manual review (which happens randomly or if something looks unusual), your refund will take longer to arrive.

Track your refund

Want to know exactly where your money is? Log into "My Account" on the CRA website to check the status of your tax refund. This handy service shows you where your return is in the process and when you can expect your deposit.

Pro tip: Setting up direct deposit with the CRA gets your money to you much faster!

How are Canada RIT deposits made?

Getting your tax refund is pretty straightforward. The CRA sends your money one of two ways:

Direct deposit: If you've set this up, your refund goes straight into your bank account. No waiting for mail, no trip to the bank—just money appearing in your account! The deposit will usually show up as "Canada RIT," "EFT Credit Canada," or "Canada Fed Deposit” on your statement.

Paper cheque: If you haven't signed up for direct deposit, the CRA will mail a cheque to the address they have on file for you.

If you'd like a faster, more seamless banking experience for all your deposits (not just tax refunds), consider setting up a KOHO account. KOHO Essentials, Extra, & Everything plans can receive direct deposits including your tax refund, paycheque, and government benefits up to one day in advance.*

*While Direct Deposits are typically received and processed one day before your scheduled payday, the actual timing may vary depending on when the payment is issued. Please allow up to 2 business days for complete processing.

Who is eligible for Canada RIT deposits?

Good news—you might have money coming your way! You're eligible for a Canada RIT deposit if:

• You filed a Canadian tax return

• You paid more tax during the year than you actually owed

It's that simple! But here's the catch: you have to actually file your taxes to get the money back. Even if you think you've overpaid, the CRA won't automatically send you a refund without a tax return.

Filing your taxes doesn't just help you get refunds—it also makes sure you receive any credits or benefits you qualify for, like the GST/HST credit or Canada Child Benefit.

A friendly reminder: if you owe taxes but don't file a return, you could face penalties and interest. Better to file on time, even if you can't pay right away!

How to set up Canada RIT direct deposit

Still waiting by the mailbox for your tax refund? There's a better way!

Quick and easy ways to sign up

Setting up direct deposit with the CRA takes just a few minutes. Here's how:

Through your bank: Many Canadian banks offer a simple option to set up CRA direct deposit right through your online banking portal. Look for "CRA direct deposit" in your account settings.

Using CRA My Account: Log into your secure CRA online account, navigate to the direct deposit section, and enter your banking details.

Over the phone: Not tech-savvy? No problem! Call the CRA at 1-800-959-8281, and an agent can help you set it up.

While filing taxes: Many tax software programs give you the option to enter your banking info during the filing process.

Once you're all set up, you can relax knowing your next tax refund will arrive quickly and safely in your account. No more waiting for the mail carrier or worrying about lost cheques!

What to do with your Canada RIT deposit

Got your tax refund? That money is 100% yours to use however you like! There's no right or wrong way to spend your Canada RIT deposit, but here are some ideas to consider:

Spend it now

Feel free to use your refund for immediate needs or wants:

• Catch up on bills

• Stock up the fridge

• Treat yourself to something special

• Fund that weekend getaway you've been dreaming about

Using your KOHO Prepaid Mastercard for those purchases can help you track your spending and even earn cash back, making your refund stretch even further.

Save it for later

Your tax refund can also be a great opportunity to boost your financial future:

• Start an emergency fund if you don't have one

• Add to your savings for a big purchase

• Put it toward paying down debt

Start building your emergency fund with your tax refund using a KOHO account, where you can earn up to 4% interest on your money while keeping it readily accessible.

Invest it to grow

Want to make your money work harder? Consider investing your refund:

• Pop it into a Tax-Free Savings Account (TFSA) where your earnings won't be taxed

• Contribute to your Registered Retirement Savings Plan (RRSP)

Here's a neat trick: putting your refund into an RRSP not only helps you save for retirement but could also lead to an even bigger tax refund next year! That's because RRSP contributions reduce your taxable income.

Whatever you choose, remember this is money you've already earned—so make it count in a way that matters to you!