Hopefully your math and rounding skills are sharp, as the Royal Canadian Mint has now ceased production of the penny, meaning the government’s new “rounding” policy is in effect.

While the cent will remain Canada’s lowest denomination for pricing items, when pennies are not available all cash transactions will now be rounded to the nearest nickel.

Payment by credit card, debit and cheque will not be affected and will continue to be settled on the cent.

It is important to note that any rounding will be incorporated after the calculation of GST or HST on the item.

Pennies will stand as legal tender indefinitely, however the mint will no longer provide them to financial institutions beginning in the Fall.

Of course, it will likely take many years for pennies to be phased out completely, and should retailers still have pennies available, the transaction will be settled on the cent.

It is only in cash transactions where the retailer does not have any pennies and the final price of the item (plus GST/HST) involves a penny denomination that the rounding will take place item.

Items at .01 or .02 will be rounded down to .00, while items at .03 or .04 will be rounded up to .05.

Meanwhile, items at .06 or .07 will be rounded down to .05, while items at .08 and .09 will be rounded up to .10.

When the mint stops providing pennies in Fall 2012, financial institutions will be asked to return pennies for the melting and recycling of their metal content.

For more information visit the government’s website here.