The Old Age Security (OAS) program is a cornerstone of Canada’s retirement income system, providing financial support to seniors nationwide. As the cost of living continues to rise, the government regularly adjusts OAS payments to help seniors maintain their purchasing power. These adjustments are crucial for many retirees who rely on OAS as a significant part of their monthly income.
In this blog, I’ll outline the monthly OAS payment increase for the remainder of 2024.
October 2024 Payment Increase
October 2024 brings another adjustment to OAS payments, with an increase of 0.7%. This increase reflects the ongoing efforts to maintain the purchasing power of seniors’ benefits. The maximum monthly OAS benefit is now $727.67 (age 65 to 74) and $800.44 (age 75+).
Age-Related Increase for Seniors 75 and Older
Seniors aged 75 and older will receive an additional 10% increase in their OAS payments. This permanent increase recognizes the unique financial challenges faced by older seniors. For those receiving the full OAS pension, this means up to an extra $72.77 per month on top of the regular payment. This age-related boost is automatically applied once a recipient turns 75.
Guaranteed Income Supplement (GIS) Adjustments
Alongside OAS increases, the Guaranteed Income Supplement will also see adjustments in 2024. The GIS is an additional benefit for low-income OAS recipients. These adjustments are calculated based on the recipient’s income and marital status. Low-income seniors can expect their GIS payments to increase proportionally with OAS adjustments, providing extra support where needed most.
Changes to OAS Recovery Tax Threshold
The OAS Recovery Tax threshold, also known as the “clawback,” will be adjusted for the 2024 tax year. This threshold determines at what income level OAS benefits begin to be reduced. For 2024, the threshold is set at $90,997. Seniors whose individual net income exceeds this amount will see their OAS benefits reduced by 15 cents for every dollar above the threshold.
Impact on Allowance and Allowance for the Survivor
The Allowance and Allowance for the Survivor, benefits for low-income individuals aged 60-64 who are spouses or common-law partners of OAS recipients, will also see increases.
Retroactive Payments for Delayed OAS Application
Seniors who delay applying for OAS can receive up to 12 months of retroactive payments, including any increases that occurred during that time. Seniors should apply for OAS as soon as they become eligible to avoid missing out on these payments. Retroactive payments will be adjusted to reflect the increases implemented throughout the year.
OAS Deferral Option
Seniors have the option to defer their OAS pension for up to 60 months after the age of 65. For each month of deferral, the pension amount increases by 0.6%. This can result in a maximum increase of 36% if deferred for the full 5 years. The deferral option can be beneficial for seniors who are still working or have other sources of income.
OAS Payment Dates for 2024
OAS payments are typically made on the third-last banking day of each month. For 2024, the remaining payment dates are October 29, 2024, November 27, 2024, and December 20, 2024. If a payment date falls on a weekend or holiday, the payment is made on the previous banking day.
International Agreements and OAS Payments
OAS payment increases for Canadian seniors living abroad will apply based on existing international social security agreements. These agreements ensure eligible seniors receive their benefits regardless of their country of residence. However, the exact amount may vary depending on specific agreements and the recipient’s circumstances.
Who Qualifies for Maximum OAS Pension in Canada?
Who Qualifies for Maximum OAS Pension in Canada?
Canada’s OAS Allowance Benefit: What You Need To Know in 2024
Canada’s OAS Allowance Benefit: What You Need To Know in 2024
