Canadians approaching retirement age or already within their golden years have long relied on the government’s Old Age Security (OAS) benefit as a dependable source of income. But with increasing concerns over the cost of living, inflation, and shifting eligibility nuances, understanding how much OAS pays—and more importantly, who qualifies—is more crucial than ever. The OAS program is a cornerstone of Canada’s retirement system, designed not by how much you worked or earned, but by your age and residency history in the country.
Perhaps surprisingly, you don’t even need to have worked in Canada to receive OAS. Unlike the Canada Pension Plan (CPP), which is based on employment contributions, OAS is funded out of general tax revenues and extends to nearly all older Canadians. However, like many government programs, the amount you receive can vary widely depending on your personal circumstances—including how long you’ve lived in Canada after the age of 18, your income level, and current age.
Key facts at a glance: OAS Overview Table
| Criteria | Details |
|---|---|
| Minimum Age to Qualify | 65 years |
| Maximum Monthly Payment (as of Q2 2024) | $713.34 (ages 65-74) / $784.67 (75+) |
| Income Threshold for Full OAS | Up to $86,912 (above which OAS is clawed back) |
| Payment Frequency | Monthly |
| Residency Requirement | Minimum 10 years in Canada after age 18 |
| Clawback Begins At | $86,912 net annual individual income (2024) |
Who qualifies and why it matters
Eligibility for OAS is less about what you did for a living and more about where you lived and for how long. To qualify, you must be at least 65 years old and a legal resident or citizen of Canada. Additionally, you need to have lived in Canada for at least 10 years after turning 18. For the maximum OAS pension, 40 years of Canadian residency after age 18 are required.
If you’re currently living outside Canada, things get even more specific. You must have resided in Canada for at least 20 years after turning 18 to qualify for OAS payments while abroad. This ensures that benefits go primarily to long-term residents rather than recent immigrants or those who have spent much of their adult lives elsewhere.
What changed this year
One of the most notable updates to OAS in recent years was the 10% permanent increase for Canadians aged 75 and over, which came into effect in July 2022. This was the first automatic top-up to OAS in nearly 50 years. As a result, those 75 and older receive a significantly higher monthly OAS payment compared to those aged 65 to 74.
In 2024, OAS benefits also increased in line with inflation as measured by the Consumer Price Index (CPI). Because OAS payments are indexed quarterly, recipients have seen modest but consistent increases—an important buffer against the rising cost of basic goods and services.
How much money you can expect
The maximum monthly OAS payment as of the second quarter of 2024 is:
- $713.34 for those aged 65 to 74
- $784.67 for those aged 75 and older
However, not everyone receives the full amount. The actual amount depends primarily on how many years you’ve lived in Canada. For example, if you’ve lived in Canada for 20 years (half the 40-year threshold), you would typically qualify for half of the full OAS amount unless you meet additional conditions.
This is where the supplement programs like the Guaranteed Income Supplement (GIS) come into play. For low-income OAS recipients, GIS can provide additional monthly funds—sometimes adding hundreds of dollars more to your monthly budget.
OAS clawback and tax implications
Once your annual net income exceeds a certain threshold—$86,912 for the 2024 tax year—you begin to repay OAS through a process commonly known as the “OAS clawback” or Recovery Tax. This is done at a rate of 15 cents for every dollar over the threshold. That means if your income is $90,000, your OAS payment will be reduced accordingly.
Full OAS is completely clawed back if your annual net income hits around $142,609 for the year. This tends to affect higher-income retirees, and strategic tax planning can help minimize the impact.
How to apply step-by-step
For most Canadians, Service Canada will automatically enroll you in OAS once you are eligible. However, some people—particularly those with incomplete records or complex residency histories—may need to apply manually.
- Wait until you’re within 6 to 11 months of turning 65.
- Log into your My Service Canada Account (MSCA) or obtain a paper application.
- Provide all necessary documentation, including residency details.
- Submit your application online or by mail to Service Canada.
- Receive a decision letter confirming your eligibility and payment start date.
“Applying early and ensuring your information is up to date—especially your residency history—can help prevent delays and maximize your benefits.”
— Placeholder, Senior Retirement Advisor
The winners and losers of recent OAS changes
| Winners | Losers |
|---|---|
| Seniors aged 75+, due to 10% benefit boost | High-income retirees facing full OAS clawback |
| Low-income seniors eligible for GIS top-up | Recent immigrants with less than 10 years residency |
| Long-term residents collecting full OAS | Expats who haven’t met the 20-year residency rule |
Planning your retirement with OAS in mind
When planning retirement, it’s essential to factor in OAS as one part of your income stream—alongside CPP, personal savings, and private pension plans. Consider timing your withdrawals from registered retirement income funds (RRIFs) and other taxable sources to minimize your net income and avoid unnecessary OAS clawbacks.
Tax-preferred investments and income-splitting strategies with your spouse or common-law partner might also offer ways to keep more of your OAS in hand. While OAS is not meant to be your sole source of retirement income, for many low to middle-income Canadians, it forms the bedrock of financial security in later years.
“The key is to ensure a diversified retirement plan, and understanding OAS specifics helps avoid costly surprises.”
— Placeholder, Certified Financial Planner
Frequently Asked Questions About OAS
How do I know if I’ll be enrolled automatically?
If Service Canada has enough information when you turn 64, they will automatically enroll you in OAS. You’ll receive a notification letter. If not, you’ll need to apply manually.
Can I defer OAS to get more money later?
Yes, you can defer receiving OAS for up to 60 months after your 65th birthday. For each month you delay, your benefit increases by 0.6%, up to a maximum of 36% if delayed by five years.
Do I still get OAS if I live outside Canada?
Yes, but only if you lived in Canada for at least 20 years after age 18 or if you have social security agreements with your current country of residence.
Is OAS taxable income?
Yes, OAS payments are considered taxable income and must be reported on your annual tax return.
Can my OAS amount change during the year?
Yes. OAS is indexed to inflation and is reviewed quarterly. It may change depending on cost of living and any changes in your net income.
What happens if I make a mistake or forget to apply?
You can still apply retroactively for up to 11 months’ worth of OAS payments, but it’s best to apply within the suggested 6-11 months before turning 65 to avoid delays.
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