Selling restaurant gift cards in Toronto: choosing amounts, terms and the December push

A gift card is money in the bank before you have cooked anything, and for many Toronto restaurants it is a meaningful part of December. Before you sell them, know that Ontario has clear gift card rules. The full rule, with its sources, is in the guide on gift card and loyalty points rules for Ontario restaurants; this guide covers the Toronto side: what to offer and when to sell.

This is general information, not legal advice. Check the current rules on ontario.ca, or ask a professional, before you design anything unusual. Ontario introduced a new Consumer Protection Act in 2023 that is to replace the current one when it comes into force, so check which Act applies when you read this.

Can a restaurant gift card expire in Ontario?

Generally, no. Under Ontario's consumer protection rules, a gift card sold for a dollar value cannot carry an expiry date. A card bought for a certain amount keeps that value until it is spent. Ontario also limits fees: a business generally cannot charge fees that reduce the card's value, with limited exceptions such as a fee to replace a lost or stolen card or to customize one.

Are there exceptions?

Yes. A card for a single, specific service, rather than a dollar amount, can be treated differently. A restaurant thinking of selling "one chef's tasting menu for two" as a card should check how the rules apply. Free promotional cards given away rather than sold are also treated differently. When in doubt, sell a dollar amount and let it last.

What amounts should a Toronto restaurant offer?

Three options is usually right, and most buyers choose the middle one, so the middle amount shapes your typical sale. Think about what the card is for. A café card is a run of mornings. A restaurant card is usually dinner for two, so it should cover dinner for two, including HST and a tip, or the recipient faces an awkward top-up at the end of a celebration. A short line in the terms saying HST and gratuity are added at the meal avoids most surprises.

Can you add bonus value?

Bonus credit, more to spend than the buyer paid, is a strong reason to buy now. Because the rules treat purchased value and promotional value differently, keep the bonus terms clear and check how they apply in Ontario before you run one.

Why does no expiry matter for your accounts?

Because unredeemed cards stay a liability until they are spent. Talk to your accountant about how to record gift card sales and redemptions, and keep an eye on the outstanding balance over time. The guide on GST/HST and gift card sales explains the tax side.

When do Toronto customers buy gift cards?

When reminded: the weeks before Christmas, before Valentine's Day and Mother's Day, before birthdays and anniversaries, and when staff mention it at the counter. Put the gift card link or counter stand where customers already look: your website, your social profile, receipts and December posts. Make sure every staff member can explain how to buy one and how to check a balance.

What should happen when a gift card is redeemed?

Make it quick and welcoming. Staff should apply the card in seconds and tell the guest the remaining balance. Many recipients have never been to your restaurant before, so treat them as a new guest worth winning rather than someone using a freebie. A guest who is made to feel awkward because a card would not scan, or who is surprised that the balance does not cover the meal, often does not return.

What should you do about lost gift cards?

Decide your policy before the first customer asks, and put it in the terms.

• Digital cards tied to an email or account can usually be checked and reissued to the right person.
• Physical cards behave like cash. Many restaurants cannot replace them without proof of purchase; say so clearly.
• Keep a record of card numbers and balances.
• Apply the policy consistently.

What should you plan in November?

1. Choose three dollar amounts based on a typical visit.
2. Write short terms with no expiry date.
3. Decide where the gift card will be sold and who explains it.
4. Train staff to redeem a card and check a balance.
5. Plan your December reminder before the first week of the month.

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More in the Canadian guides for food businesses.