Proof of Funds
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How to Show Proof of Funds for Canada Immigration
This article consists of two very important parts:
Part 1 – covering “What amount of funds do I need to prove?” and
Part 2 – “How do I go about proving these funds?”
Part 1 – What amount of funds do I need to prove?
Do I need to have Proof of Funds for my Express Entry application?
Express Entry handles three main types of Permanent Residency Programs, Federal Skilled Trades, Federal Skilled Worker and Canadian Experience Class.
If you are applying for Federal Skilled Worker (FSW) or Federal Skilled Trades (FST) you will need to show proof of funds.
If you are applying for either of these two programs and you have a valid Canadian job offer as part of your application you are exempt from the proof of funds requirement.
If you are applying under the Canadian Experience Class (CEC) you are also exempt from having to show proof of funds.
Why does Canada require Proof of Funds for Permanent Residency applications?
When you come to Canada to start your new life as a permanent resident, Canada will not be providing you with any direct financial support. Canada needs to know that you have enough money to support yourself and your family for the first few months after arrival as you find somewhere to live and look for your first job.
This is why applicants with valid Canadian Job offers do not need to show proof of funds, as they have a job upon arrival and will be earning a salary immediately upon arrival.
How does Canada decide how much the Proof of Funds needs to be?
Canada has a stated income threshold called the Low Income Cut Off or LICO. Each year these amounts are determined to demonstrate the minimum income level required in Canada to have the necessities like food and shelter covered. Canada takes this amount and divides it in half and that is the amount a new permanent resident is required to have to support their move to Canada and help them get established over the first few months.
It is expected that within 6 months a new arrival should be employed and earning income in Canada, so only half the LICO annual amount is required.
Does the Proof of Funds amount change over time?
Yes, the Canadian Government adjusts this amount every year in line with an assessment against the increased cost of living and the determined annual Low Income Cut-Offs.
What if the Government increases the amount after I have submitted my Invitation to Apply documents?
Any update would not impact you. If the change occurs after you have received your invitation then you don’t have to meet the increased amount, only the amount that was current at the time of your submission.
What amount of funds do I need to prove?
The proof of funds required is determined by your family size. This size is determined by your actual family size (including dependent children up to 22 years old), regardless of whether they are coming to Canada with you at this time or not.
If you are single, you are a family size of 1. If you have a spouse and 3 children you are a family size of 5.
Current Proof of Funds requirements
(in Canadian dollars)
What if my spouse or child is not accompanying me to Canada? Do I need to include them in my Proof of Funds amount?
Yes, you do. Regardless of whether your spouse or children are accompanying you to Canada or not, you must include them in the amount for Proof of Funds.
E.g. If you are going to Canada but your spouse and two children will be staying behind in your home country for now, you are still considered a family of four for proof of funds purposes.
This is who you must include in your proof of funds family size calculation.
To calculate the size of your family you must include
- your spouse or partner
- your dependent children and
- your spouse’s dependent children
Include your spouse or dependent children even if they’re
- permanent residents or Canadian citizens
- not coming to Canada with you
So as you can see – even if they are Canadian citizens you need to include them. Be sure to get this correct to avoid any unnecessary surprises down the line.
Part 2 – “How do I go about proving these funds?”
What is the requirement for the funds?
The money must be available to you to use freely upon your arrival in Canada.
It must be unencumbered. It should be free of any debts or any loans.
Every aspect of the proof of funds process is to show clearly that you have the funds required available to you to use and they are not borrowed funds.
So cash in a bank account in your name is by far the best and easiest way to meet the criteria.
What is not acceptable to use as proof of funds?
These items are NOT acceptable as proof of funds for your immigration purposes:
- Assets of other kinds
- Real estate
- Share portfolios
- Insurance policies
If you wish to use these items to form part of your proof of funds, you will need to sell them and use the cash received to place into your bank account, and that’s how it can be counted.
Is there a time requirement of the funds being in my name?
No, there is no specific amount of time the funds need to have aged in your account for the purposes of Express Entry. However, if you have had no money in your account and then suddenly you receive a large amount that forms your proof of funds, you will need to explain where the funds have come from. You will do that with a letter of explanation when you submit your documents.
If the funds have only been in your account a short period of time this is fine, just be able to show and explain where the funds came from, and prove they are not a loan and are freely available for you to use.
This guide is for Express Entry. There are a couple of situations with Provincial Programs that require you hold the funds for 3 or 6 months before their provincial nomination, but they are very few and so it’s a good idea to get your funds in your own name and in a clear bank account to avoid any possible hassle if you are pursuing a program other than Express Entry.
How do I prove the funds – what documents are needed?
In most cases, a letter from your bank and by providing the past six months of your bank statements.
The letter you are after from your bank is very specific. It should include the following information
1 – your full name
2 – each of your accounts with the bank
3 – the account number of each account (current , savings and investment accounts)
4 – the date each account was opened
5 – the average monthly balance for each account over the past six months
6 – the current balance for each account
7 – any outstanding debts or loan accounts with the bank (including credit cards and home loans)
8 – It must be on bank letter head
9 – it must include an original signature with a contact person at the bank with contact details
10 – it must be dated
Some banks are happy to supply this information, others are more difficult to deal with.
If your bank is more difficult, you should still be able to get a letter with the basics of your name, all your account numbers and current balances including any loans or debits, on bank letterhead and signed. It might be referred to as a statement of accounts, or a statement of good standing with the bank.
Each bank calls it something different. If this is all you can get, still get it. It will most likely mean more documents such as bank statements, bank books, and other documents may be required to cover your proof of funds. Your immigration officer will let you know.
It is always best to try and get the full and complete letter from your banks, it saves a lot of hassle down the line and allows your application to progress more smoothly.
Are joint accounts ok?
Funds held in a bank account in your own name is the simplest situation. However, funds held in a joint bank account with your spouse who is accompanying you to Canada is also acceptable, as is funds held in an account of just your spouse’s name.
However, in this case your spouse will need to provide an affidavit document stating that the funds are free and available for you to use at will, the same as if it was your own money.
Bank accounts in other names, or other family members’ names such as parents, children, grandparents etc should be avoided and are generally not acceptable. Funds held in business bank accounts are not acceptable.
What if I don’t have the money but a family member has gifted it to me?
You are absolutely allowed to receive a “gift” from a family member of the amount required for proof of funds. What you need to do is to prove to the Immigration Officer that this was indeed a gift and not a loan.
The best way to do this is to show the funds are in a bank account in your own name now, not a joint account.
You will want to include the transaction receipt to show clearly who the funds came from.
You will then want to get a sworn affidavit from the person who gifted you the funds that states their name, the amount of funds they gifted you, the date they gifted you the funds, and where they got the funds from that they have now gifted to you (e.g. savings or selling their share portfolio or some land etc).
The affidavit must clearly state the funds are a gift to you and are freely available for you to use as you wish. It should state the funds are not a loan and there is no repayment required, that the funds are simply a gift.
You will need to submit this affidavit, transfer receipt and any other evidence you have along with a letter of explanation that you write, explaining the situation, who the person who gifted you is, and why they gifted to you. It would be acceptable (and quite common) for example for parents to gift their children some money to start a new life in Canada.
What other financial details do I need to give ?
It is very important that the Immigration Officer can determine clearly that you have these funds free and clear and that they are not to a loan and also that they are not required to pay other loans or debts you may have.
You will be required to provide your bank statements for the past six months also – so if any loans or debts are being deducted from your account or show up you will need to explain those in a letter of explanation.
In that letter to the officer you can explain how that debt is paid and if there is a plan to clear that debt. A letter of Explanation is just a letter explaining something that you would like the officer to understand about the documents that you are submitting.
Usually a loan against your home or car is fine, you just have to declare it and explain it.
At what point will I be deemed to have proof of funds?
At two separate points in time. The first is when the Immigration Officer is assessing your case. They will do a calculation on the exchange rate on the day they deal with your file. The second time is when you arrive in Canada, you may well be asked to show your proof of funds and another calculation will be done on the spot to ensure you have over the minimum funds.
This is another reason to have more than the minimum funds in case of exchange rate fluctuations between the granting of your visa and your arrival.
Do I also need to show proof of funds upon arrival in Canada?
As mentioned above, yes you do. The funds are meant to be officially determined upon your arrival in Canada, so be prepared with your documents and proof in case they ask you at the immigration point.
What currency does my proof of funds need to be in?
Your proof of funds is usually your local currency but does not have to be. Many countries have other currency accounts available and if you can hold it in Canadian Dollars it ensures the exact amount of funds you have with no room for confusion or exchange rate fluctuations. However, this is not at all necessary, your local or another major currency is fine, just place some more in the account as proof to avoid hassles with rate movements.
What if the exchange rate moves against me after I have submitted my documents?
Really aim to submit more than the minimum amount for proof of funds. This way if the exchange rate moves against you, your application will not be flagged. Usually, if the amount you are now under is just a couple of dollars and the officer can see it is an exchange rate drop it is passed through, but not always.
If it is an amount of more than $50 you may well be asked to submit further proof of funds, which can slow everything down. Simply avoid it by putting extra money in for the proof of funds.
Should I submit a letter of explanation?
Yes, you should always submit a letter of explanation (LOE). A letter of explanation is your best friend in this proof of funds process. It is a chance for you to make the Immigration Officers life easier and to make proving your funds smoother.
Anything that leaves a question in the Officer’s mind is something they will have to follow up with you on and that can lead to a Procedural Fairness Letter, which is a letter from the officer seeking more documents and information from you. This slows down your application and can lead to even more information being required simply because you didn’t explain yourself.
So if there is anything that requires explanation such as your debts, your receiving of a gift of funds or a significant amount arrived in your account (maybe you sold your home or car), then don’t leave it for the officer to guess what is going on, simply submit a Letter of Explanation to help things along.
What do I do if I get a Procedural Fairness Letter?
A procedural fairness letter is an email or letter electronically sent by an immigration officer. The officer sends that letter to allow a visa candidate to respond to a concern about the documents that have been submitted by a visa applicant.
If you receive one simply read what they are asking and respond to it as soon as possible with the information and evidence they are seeking.
Don’t panic if you receive a Procedural Fairness letter, it usually means that you have not provided all the information that was required for them to know for sure that you will have full and free access to these funds, or that any loans or debts are not related to these funds, and will be paid from other monies.
Never ignore a procedural fairness letter, if you do not reply your application will most likely end up rejected.
The key point of the Proof of Funds process
The overarching goal of the proof of funds process is for the Immigration Officer to be certain that the funds required are actually available for you to use freely upon your arrival in Canada. That is the aim of the process. So do all you can to make this simple for the officer to see and prove, and it will all go smoothly for you.