The Real Cost of Getting Paid in USD for Canadians

The Real Cost of Getting Paid in USD for Canadians

The USD is currently quite strong in relation to the CAD, so Canadian remote workers who are paid in American currency may feel that they’ve lucked out at first.

However, once you factor in unfair exchange rates from private financial institutions, bank fees, and the lack of affordable options for online money transfer, getting paid in USD costs more than it would originally seem.

In this post, we’re going to discuss what sort of bank fees Canadians can expect when accepting online payments from the United States, how to find the best exchange rates, and where to get the most affordable online money transfer rates.

Getting Paid Across the Canadian-American Border

Since our world has become more digital in recent years, remote work has become more and more popular. The need for social distancing due to COVID-19 has sparked an even greater boom of remote workers.

The ability to work from anywhere with the internet gives companies the ability to hire the best-suited candidates, even if that means they’re in a different city, another providence/state, or even a different country.

Location independence and location flexibility have led to Canadian contractors being hired by American companies. This has also opened opportunities for American contractors to move to Canada and Canadian-Americans to move back up North.

Since contractors aren’t typically paid via automated payroll solutions like employees are, there is a bit more to consider when they are accepting payment for their work.

Finding the Best USD to CAD Exchange Rate

If you are living in Canada but getting paid in USD, you’re going to want to make sure you’re banking with an institution that is giving you the best exchange rate with the most reasonable bank fees.

In order to get a good idea of what the going CAD to USD exchange rate is, you’re going to want to check the mid-market exchange rate. This is the measure of the current value of one currency in terms of another.

Google has a built-in calculator that lets you know exactly what $1.00 CAD is worth in terms of USD. Simply Google “CAD to USD” or “USD to CAD” and the calculator will appear. You can input different values for either currency to see the exchange rate.

You can take the exchange rate you find there and compare it to different financial institutions and banks’ exchange rates. They change the rates as a way to make money

For example, if the mid-market exchange rate is $1.00 USD to $1.35 CAD, an institution may quote you $1.00 USD to $1.30 CAD. They would pocket $0.05 CAD on every $1.00 USD. Just as an example, on an average salary of $80,000 USD for a software developer, that is almost $4000 lost in foreign exchange fees!

It is totally normal for these institutions to charge a fee in this fashion. After all, they need some sort of income to keep functioning. You’re not comparing to catch the “discrepancy,” but you’re shopping around for the best rate.

While we’re on the topic of “shopping around,” we’d like to point out that you should also shop around for a bank if your current one is charging senseless fees.

Most banks charge service fees, but if you find your bank charging fees that simply don’t make sense, there is no harm in looking at other options. Check out both local banks and larger chains.

Affordable Online Money Transfer Services

Employees who work from home are typically paid via cheque or direct deposit since they are on the company payroll. However, since contractors are not on the payroll, online money transfer services are typically the go-to for payment.

Popular online money transfer services like PayPal and Stripe come with fees of around 5%. This might not seem like much, but when it comes to paycheques that are in the thousands, you’re looking at losing out on hundreds of dollars.

Luckily, Remitbee is releasing an online currency exchange, so that you can exchange your USD to CAN, with the lowest fees ranging from .005% to .01%, and the best exchange rates.


Receiving payments in USD as a Canadian can be a bit pricey if you aren’t careful with your choice of bank and money transfer service. However, when you’re intentional about the money transfer service you use and the institution that you bank with, you can make this process a bit more affordable.

Spend some time educating yourself on the options available, and weigh your pros and cons. We’re confident that you will find the bank and transfer service that makes the most sense for your needs.

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