An example of a transfer payment is

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An Old Age Security Payment is a transfer payment because the money is transferred from the government to eligible citizens as a form of social assistance. A teacher's paycheque and a paycheque for a member of the Royal Canadian Air Force are not transfer payments because they are payments for work performed. The purchase of a new bridge to PEI is not a transfer payment because goods and services are exchanged. Federal income taxes collected in Saskatchewan are not transfer payments because they are taxes paid to the government.

An Example of a Transfer Payment Is