Many Canadians look forward to a tax refund with eager anticipation. They consider it a tax-free windfall that they can spend without feeling guilty.
We’re so anxious to do so that close to 1 million of us choose to receive our tax refund on the spot, generally paying anywhere from 10 to 15 cents on the dollar for the privilege of having the money loaded on a debit card from places like H&R Block or Money Mart.
Tax discounters are allowed to charge no more than 15 per cent on the first $300 of the refund and five per cent of anything above that.
Most advisors decry the practice, arguing that an instant refund is a dumb way to pay to access your own money and that getting a refund in the first place means you've already provided the government with an interest-free loan.