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Welcome! In this newsletter, we are set to explore a critical detail of Canada’s economic landscape – the Old Age Security (OAS) gadget. This is a widespread topic for all people residing in Canada, however especially for those drawing close retirement. So, whether you’re seeking to understand your very own destiny advantages or are actually curious about how Canada supports its growing old population, you’ve got come to the right location.

Overview of Old Age Security (OAS)

First, permits begin with what OAS is. Essentially, it is a month-to-month fee that the Canadian government offers to most Canadians who are 65 and older. Interestingly, this pension is not something that residents pay into directly. Instead, it’s financed out of the general tax revenues of the Government of Canada.

The History of OAS in Canada

The OAS has rich records. It originated in 1952 as an advantage for people aged 70 and over who met positive method-examined standards. However, amendments in 1965 reduced the age of eligibility to sixty five and related the blessings to the Consumer Price Index to keep tempo with inflation.

Eligibility Criteria for OAS

To be eligible for the OAS, you want to be a Canadian citizen or criminal resident, be 65 or older, and have lived in Canada for at least 10 years on account that turning 18. These standards ensure that the ones who have made Canada their domestic for a great portion of their lives are supported in their retirement years.

Amount of OAS Benefits

The amount of OAS pension one can receive varies based on several factors, including residency length and income level.
1. Basic OAS Pension

The quantity you’ll acquire in large part depends on how long you have lived in Canada after turning 18. If you have resided in Canada for at the least 40 years after the age of 18, you can expect to get hold of the whole quantity. As of 2023, that is about $7,384.48 consistent with 12 months.

2. Guaranteed Income Supplement (GIS)

The GIS is a month-to-month, non-taxable complement to the OAS pension for low-earnings seniors. It presents additional help to those who need it the maximum.

3. Allowance for the Survivor

The Allowance for the Survivor is a benefit for those whose spouse or common-law partner has passed away. If you’re aged 60-64 and meet certain conditions, you might be eligible for this.

Payment Schedule and Methods

The Government of Canada delivers OAS payments usually during the last three business days of each month. Payments can be received either via direct deposit to your bank account or by cheque.

How to Apply for OAS

Applying for OAS involves filling out an application form and providing necessary documentation. The government advises applying six months before you turn 65 to ensure your benefits begin on time.

Impact of Other Income on OAS

It’s essential to understand that your OAS benefits can be affected by other income. If your income exceeds a certain threshold (currently around $79,054), you’ll start seeing a reduction in your OAS pension.

OAS Clawback: Understanding the Recovery Tax

This reduction is commonly referred to as the “OAS clawback” or Recovery Tax. For every dollar of income above the threshold, your OAS is reduced by 15 cents. This means if your income is significantly above the limit, you could lose your entire OAS pension.

OAS Deferral: Pros and Cons

You also have the option to delay your OAS pension. By doing so, you could receive a higher monthly amount when you start receiving your pension. However, this decision has both advantages and drawbacks that need careful consideration.

OAS versus Canada Pension Plan (CPP)

The OAS and CPP are two crucial components of Canada’s retirement income system, but they operate quite differently. Unlike the OAS, the CPP is based on your work history and the amount you’ve contributed over your career.

Maximizing Your OAS Benefits

Maximizing your OAS benefits can involve strategies like deferring OAS until you turn 70, effectively managing your retirement income to minimize the clawback, and applying for any eligible supplements.

OAS for Immigrants: What You Need to Know

If you’re an immigrant to Canada, you may still qualify for OAS. We’ll delve into the rules for newcomers, including the significant “10 years in Canada” rule.

Future Predictions for OAS in Canada

While we do not have a crystal ball, we can consider capability future tendencies and challenges for the OAS gadget. This includes elements like Canada’s ageing population and the lengthy-time period sustainability of the pension gadget.

Frequently Overlooked Aspects of OAS

We’ll factor out some frequently-overlooked information about the OAS. For example, if you’re divorced or separated, you is probably capable of qualify for the Allowance for the Survivor.

Comparison of OAS Benefits: Canada vs Other Countries

How does Canada’s OAS system stack up against similar systems in other countries? This section will provide a comparison between the OAS and pension systems in other nations like the US, the UK, and Australia, providing a broader global context.

OAS in Context: The Bigger Picture of Retirement Planning

The OAS forms a significant part of retirement planning, but it should be considered within the broader context of your retirement income. Other aspects, such as CPP, personal savings, and other income sources, are equally important in securing a comfortable retirement.

Preparing for Changes in OAS

Given the ever-evolving nature of public policies and economic conditions, it’s crucial to stay informed about potential changes in OAS. We’ll discuss how to stay updated and adapt your retirement planning to accommodate these changes.


We’ve explored a lot today, and hopefully, this detailed look at Canada’s OAS system leaves you better equipped to navigate and plan for your future. Understanding the OAS is a key step towards financial security in retirement.

Salman Rundhawa
Salman Rundhawa
Salman Rundhawa is the founder of Filing Taxes. Salman provides valuable tax planning, accounting, and income tax preparation services in Toronto, Mississauga, Oakville, and Hamilton.

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