How much will the government pay you?

A while back, I wrote an article on how much money you might get from government benefits.

In the article I stated, “The most you will receive from the government is $24,346.44 if you have no other sources of income and only $16,684.92 if you have other sources of income. Clawback and contribution rules may reduce these amounts.”

I’ve been asked by many readers where these numbers came from so here it is.

First, let’s address the $16,684.92. Most Canadians will qualify for some level of Canada Pension Plan (CPP) and Old Age Security (OAS).

At the time the article was written, the most you could collect from CPP was $10,614.96 per year. For Old Age security the most you can get was $6,069.96 per year. Add those numbers together and you get $16,684.92.  Heres the maximum CPP and OAS amounts for current years:


YEAR Max Monthly CPP Max Monthly OAS Combined monthly Combined Annual Max
2013 $1,012.50 $546.07 $1,558.57 $18,702.84
2012 $986.67 $540.12 $1,526.79 $18,321.48
2011 $960.00 $524.23 $1,484.23 $17,810.76
2010 $934.17 $516.96 $1,451.13 $17,413.56
2009 $908.75 $516.96 $1,425.71 $17,108.52
2008 $884.50 $502.31 $1,386.81 $16,641.72
2007 $863.75 $491.93 $1,355.68 $16,268.16
2006 $762.92 $484.63 $1,247.55 $14,970.60

 

As of October 2007, the average CPP retirement pension paid out was only $481.46 per month. That’s a lot lower than $884.58 per month because not everybody qualifies for the maximum. Some of the reasons you might not get maximum CPP includes lower contributions because of lower income levels or not contributing for enough years because of starting late into the workforce or maybe you retire early which also means you contribute less into CPP.

1. Canada Pension Plan is a contributory plan. Basically that means how much you get when you retire depends on how much you contributed while you worked. If you have made at least one payment into the CPP plan, you qualify to collect a benefit.While it would be nice to get the maximum from the government, not everyone does. As I said in the article that amount represents the most anyone can get from the government. Here are a few examples of why people might get less than the maximum:

It’s a little more complicated than this but basically, you have to contribute the maximum amount for at least 40 years over the age of 18 to qualify for the maximum benefit. For more details, you can visit the Service Canada website (www.hrsdc.gc.ca).

Related article:  How much will you get from CPP in retirement?

2. The maximum CPP amount is based on a normal pension at age 65. You can collect the CPP as early as age 60 but at a reduced amount. In 2013, you will lose 0.54% for every month you take CPP before your 65th birthday. For example, at age 60, you will lose 32.4% (0.54% x 60months) of your eligible amount at age 65. To collect CPP early, you no longer have to stop working.  Taking CPP early means makes good sense for most people but it means you will not get the maximum.

Related article:  Should you take CPP early under the new rules?

The best way to find out how much you will get from CPP is to check your Statement of Contributions, or call 1 800 277-9914. The closer you are to the date on which you want to begin your pension, the more accurate the estimate will be.

3. Old Age Security is a monthly benefit available to anyone 65 years of age or over (unlike CPP, you cannot collect earlier). Eligibility for OAS is all based on residency and has nothing to do with employment history. It also does not matter if the applicant is working or retired. If you were resident of Canada for less than 40 years after the age of 18, you will get a reduced amount of OAS.

Related article:  Three big changes to OAS

In addition to the basic OAS pension, low-income seniors may qualify for other retirement benefits such as the Guaranteed Income Supplement (GIS) and the Allowance. The threshold for low income depends on whether you are single, married or widowed. That’s where the $24,346.44 figure came from. The difference between this number and $16,584.92 is the maximum benefit for GIS as a single person. Again, few people qualify for the maximum GIS.

Related article:  The difference between CPP and OAS

The rules for government benefits are not easy to understand. For more information, contact Service Canada.

Other Relevant Articles

New proposed changes for CPP

Will Canada Pension Plan (CPP) be there when you retire?

Child Rearing Drop Our Provision – parents can get more out of CPP

How to get CPP early

Two Conundrums of CPP

Written by Jim Yih

Jim Yih is a Fee Only Advisor, Best Selling Author, and Financial Speaker on wealth, retirement and personal finance. Currently, Jim specializes in putting Financial Education programs into the workplace.For more information you can follow him on Twitter @JimYih or visit his other websites Group Benefits Online and Advisor Think Box.

168 Responses to How much will the government pay you?

  1. I was forced to retire prior to turning 65 due to ill-health. So, I retired and am fast approaching my 65th birthday, at which point, as everyone has told me, I will lose whatever CPP has been sending me each month.

    I was a provincial employee and paid into our pension plan. I receive a cheque from this fund. I applied for early CPP and receive a cheque from CPP. According to all, once I turn 65, the pension amount from CPP will be “deducted” from my provincial pension cheque.

    For example, say I receive $2000 a month from my provincial pension and $600 from CPP; according to retired friends, once I’m 65, the provincial pension will be dropped to $1400 a month and I will receive $600 from CPP — essentially, a big drop in income regardless of which cheque is affected. :(

    Can you tell me why this will happen and if there is any way to minimize the loss?

    • Gloria
      It is unclear to me whether the CPP that you are currently receiving is the disability pension or the early retirement pension. If it is an early retirementy pension, that amount will continue to be paid to you until death (with annual increases for cost of living). If it is a disability benefit, that will convert at age 65 to a retirement pension at a lower rate. The basic formula for the conversion from disability to retirement benefit is to subtract the flat-rate benefit (approx $440) and divide the answer by 75%. Thus if your current CPP disability were $600/mthly, your converted retirement pension would be about $213.33 ($600-$440)/75%.
      As to your provincial pension, you probably should check with your personnel office, but the common approach if you worked for the province for your entire CPP contributory period is that your pension from them would be reduced at age 65, by your estimated age-65 CPP retirement pension (which may be more than your actual CPP if you’re receiving the early retirement benefit.
      The good news (assuming you’ve lived in Canada for at least 40 years after age 18) is that you should also be eligible for Old Age Security (OAS) at age 65. The approximate amount of OAS is $530 mthly.

    • I receive a provincial pension and the clawback is calculated when I retired, independent of my CPP. It is a little higher than my CPP at age 60 but does not start til age 65 so I feel it is to my benefit to receive CPP for 5 years with no clawback. If you wait til 65, CPP will be bigger but you have lost 5 years of CPP at the lower rate. I calculated to breakeven at age 76, if I am still alive.

    • Yes, we Canadians have certainly become accustomed to some wonderful advantages for living in Canada … health care and post retirement assistance however they are not free.
      Would you have the same outlook knowing that these ‘freebies’ come at a tax rate that easily creeps into the 40% or more range of your earned income?

      • I certainly don’t mind and I’ve worked all my life.
        i’m proud to live in a country that for now at least is better at sharing the wealth.

  2. Does the calculation of the benefit (before the penalty) at 60 count the years 60-65 as no income for the average? In other words, can they bring down the average?

    I am thinking of someone who turns 60 and can choose to stop working early but has less than 40 years of contributions. Is the difference just the 30% or must they also look at any potential increase in their benefit from 5 more years of higher contributions?

    • Mike
      If someone applies for a CPP retirement pension at age 60, their contributory period ends then, thus they will not have those 5 years of zero income reducing their average earnings for benefit calculation purposes.

  3. Jim I believe that the $24K in maximum benefits may be overstated. If you receive the maximum in CPP benefits of $10.6K and OAS of $6K, you can’t receive the full amount of GIS payments of $7.7K because your CPP income is included in the income that is taken into consideration for GIS clawback. So based on 2012 clawbacks they would only receive $2.9K in GIS payments. This would total $19.5K. Please correct me if I’m wrong. Please clarify. Thanks.

    • Jeff
      I agree with you 100%, but if we want to use the 2012 figures for the GIS, perhaps it would be useful to update the CPP & OAS figures also.
      I get max CPP for 2012 as $986.67 mthly x 12 = $11,840 annually and max OAS for Jan/2012 as $540.12 mthly x 12 = $6,481 annually. Using the $11,840 to calculate GIS for a single pensioner would be $188.76 mthly x 12 = $2,265.
      Using these numbers, the max gov’t payout for 2012 would be $20,586 ($11,840 CPP + $6,481 OAS + $2,265 GIS).

    • Jeff
      I agree with you that you can’t count the max GIS if you’re receiving max (or any) CPP. Updating all of the data for Jan/2012, I get:
      – max CPP mthly of $986.67 x 12 = $11,840;
      – max OAS mthly of $540.12 x 12 = $6,481;
      – GIS of $188.76 mthly (based on max CPP of $11,840) x 12 = $2,265.
      – combined total of CPP/OAS/GIS = $1,715.55 mthly x 12 = $20,586.

  4. Denyse
    Owning a house or condo (or any other assets) does not affect GIS eligibility. The only 3 factors are:
    – receiving OAS;
    – marital status;
    – income (combined income if married or C/L).

    In your example, if the person is receiving “full OAS” (based on having lived in Canada for 40 years after age 18), is single and has income only of $400/mth CPP, they would be eligible for GIS in the amount of $481.76/mth.

  5. I already receive a pension from my workplace of 33 years. When I reach the age to get old age and cpp do i lose this amount from my workplace pension?

    • Tony
      You would have to get that answer from whoever administers your workplace pension. Some plans are “integrated” with the government benefits (OAS and/or CPP), whereby they pay higher amounts until you become eligible for benefits from the government. Other workplace plans are independent from government benefits and may not be reduced at age 65 or when those government benefits start.

  6. I just wanted to thank you so much for such great information. I still have a few years to go but it still helps to be informed. By the time I retire things will totally be different because the Canadian Government likes to change things without our input.

  7. Great info Doug, thanks a bunch.
    Amazing, so many Canadians don’t know all the ins-and-outs of our system. For example one of my neighbors just turned 65 gets max CPP benefits but I mentioned what about OAS, he was clueless. Apparently when you apply for CPP whether earlier or at age 65, OAS is not received until you separately apply for it. And the good thing if we can say anything for the governement, they told him once you apply for OAS it is paid retro-actively from when you apply to that starting age of 65.

    • Phil
      You’re welcome for the info. I’m glad to be able to pass on some of the knowledge that I learned in working for OAS/CPP for over 30 years. Speaking of which, the retroactivity that your neighbour mentioned for OAS is limited to 1 year, so it’s good that he learned of it when he did.

  8. If a woman (or man) stops working to have children (raise children) and never really goes back to full-time work for the rest of her/his life, is there some advice you can give as to how much money she/he can expect for her/his contribution to society?
    Will they be poverty stricken because their contribution to society was in the area of volunteerism (not measurable in GDP or dollar earning exactly)? Has the government thought of rewarding volunteers for their equally important, but not monetarily measurable contributions?
    It seems that CPP should not only be tied to “paying in dollars” but also recognizing years of effort and time/volunteer hours. Has there been some thought given to that by the government to your knowledge? Since most communities have a lot of non-profit organizations and charitable efforts, we see huge numbers of people volunteering their time, sometimes they are unable to find work and volunteer in the meantime, but some forego a salaried job for the growth and benefit of their community and community organizations. Some of these people are well off due to spouses working, but some live a meager existence, yet contribute hugely to the social fabric of their communities by their dedication, hard work and sacrifice. This is not being recognized at pension time, yet hours and hours of time are devoted to their country and community without a measurable monetary input.

    Would love to hear your thoughts on this and if you feel it would be beneficial (what with all the push for people to “serve” “volunteer” etc) if some of these volunteers (under certain conditions) may be able to translate their freely given hours into a pension later in life. I am thinking of clergy also in this, but mainly people who volunteer for a non-profit organization (community recreation, religous, charities, etc) and are unable/unwilling to hold a full-time job because of the time commitment (or even that taking a full-time job would mean the valuable work of that organization would falter). Would love to hear your thoughts on this.

    • Dear Interested Reader
      From a CPP perspective, every year spent out of the workforce raising children under age 7 by an eligible parent (usually the female), can be “dropped out” under the CRDO provision. This won’t create a benefit if they’ve never worked, but if they did work before or after raising children, it will increase the amount of their benefit by about 2.5% for every year that they’re able to drop out.
      Aside from feeling good about themselves, the only other “payment” for volunteers is under the OAS program. Under that program, each year of residence in Canada after age 18 (up to a max of 40 years) is worth about $13.50 monthly at age 65. In addition, if they have no other income, they could be eligible for up to $732/mth in the form of GIS benefits.

      • Re: “payment” for volunteers
        quote ” the only other payment for volunteers is under the OAS program. Under that program” What is “that” program named and how do you apply for it? Are stay at home moms considered volunteers under this program? Thank you

  9. I am 59 and retiring next July; My private pension will be approximately 6000/mnth; My wife quite work when we had our kids however she will be collecting $200 per month Canada Pension; I am figuring maximum Canada pension of “800 something”
    1. If I continue to work a part-time job (not related to my principal occupation) that pays approximately 1200 a month will it have an effect on my ability to collect/ amount of Canada Pension?

    2. What is the present maximum amount of Canada pension to collect at 60 years old?

    • Allan
      1. Effective 2012, working a part-time (or even fulltime) job has no impact on your ability to collect your CPP retirement benefit at age 60, and it affects the amount of your benefit only if it increases or decreases your “average lifetime earnings” prior to age 60.
      2. For 2012, the maximum age-65 retirement benefit is $986.67. If you start your CPP retirement benefit prior to age 65, for 2012 that amount is reduced by 0.52% for every month that you’re under age 65. Therefore the max age-60 CPP retirement benefit for 2012 is $678.83 ($986.67 – 60 X 0.52%).

  10. I was told by a gov. agent that if we make 21.700.oo we were not able to collect any gis monies from the gov.If that is true you would be better off knowing about the system when you call or read the system you get different answers. Sad system people moving in to Canada knows more about the details the we being bon here BIG ?

  11. I’m 57. I would like to start collecting my pension at 60. I was told that my pension would be $350. Will I get some GIS if I have some bank interest? And what about RRSP if I don’t want to withdraw it for some time? Thanks

    • Allan
      GIS is part of the Old Age Security program, so you can’t receive GIS until age 65 at the earliest. At that time, the amount of GIS would depend on your marital status, your income (joint if married or common-law) and how many years of residence you have in Canada.
      For example, if you are receiving the full OAS (40 yrs residence in Canada after age 18) and if you are single, the maximum GIS is $732.36/mth and it’s basically reduced by half for any income that you have (excluding the OAS itself). The current annual income cutoff for a single pensioner is $16,368, above which you wouldn’t receive any GIS.
      I hope this helps?

  12. How in hell can any two, retire on an income making a couple of dollars more than 21,648.oo be closed out from receiving the GIS. Not all people in their days of struggling to make a living by working dam hard coud save for a great sum of monies to lay back and live on in time of retirement.Yet there are ways for some people to get GOV. hand outs with out working ever in their lives. Good luck for those who can God Bless Those who cant

  13. And if my wife and I start collecting pension at 60 and it will be $700 (combine), will we recieve any additional allowance? Thanks

    • Allan
      I’m not really sure what you’re asking? When you say that you will both start collecting pension at age 60, I assume you’re talking about the Canada Pension Plan (CPP)?
      If so, there are no further government pensions until at least one of you reaches age 65, at which time you should qualify for Old Age Security (OAS), depending on how long you’ve lived in Canada since age 18, and possibly the Guaranteed Income Supplement (GIS). If the other one of you is still under age 65 at that time, that person might then be eligible for the Spouse’s Allownace, depending on residence in Canada and income.

  14. what income can 2 people expect when we retire we are wife is 58 and i am 60 both of have always work and there are no company pensions just cpp and oas.
    Thanks

  15. Doug, the replies you have provided to everyone have been so much more helpful than anything I can find on the GC.CA sites. They warn their tables for OAS/GIS calculations only apply if you have lived in Canada the full 40 years. When younger, we lived overseas for over 15 years so can never get to 40 years. With 27 years of Canada residency by 65, your 13.50 per month figure suggests an OAS of $364 per month at age 65. If CPP is also less than max at $650 per month, and younger partner age 60 opts to retire at same time taking early CPP of $400 month, and no other income/RRSPs, how can we estimate GIS and Allowance for the first 4 years until parter reaches 65 and also gets a reduced OAS? Many thanks.

    • Jess
      Before I reply to your question, there’s a bit more info that I need. What is each of your mth/yr of birth, and what years have you resided in Canada?
      The importance of these questions is that the 40-year rule is only one way of qualifying for full OAS. If you were a) age 25 by July 1, 1977 and b) had some residence in Canada over age 18 and prior to July 1, 1977; there are a couple of other ways that you might qualify for the full OAS and not the 27/40ths that you are counting on.

      • Thanks again, my partner Len is born Jun/53 and departed in Apr/78 at age 24. I am born Apr/58 and departed Oct/79 at age 21. We both returned to Canada in 1997. So neither of us was age 25 in 1977. It’s a good thing we have experience living frugal artist lifestyles!

  16. Jess
    Thanks for the additional details. After doing a little further checking to refresh my memory (I “retired” from the gov’t almost 10 years ago), it appears that at your income levels, there is little or no difference to the net amount that you will be eligible for, combining the OAS, GIS and Allowance amounts, regardless whether your husband qualifies for full OAS (which he won’t) or partial OAS (which he will).
    That is because the gov’t “tops up” partial OAS recipients who are eligible for GIS, by adding more GIS benefits to replace the missing OAS benefits. In some ways you’ll actually be better off, as the OAS benefits are taxable and the GIS?Allowance benefits are not taxable.
    So, by my calculations and using the current April/12 benefit amounts, your husband would be eligible for about $915/mth (comprised of 27/40ths of the full OAS of $540.12 = $364.50 plus a topped-up GIS of approx $550.50) and you would be eligible for an Allowance of approx $376/mth. How’s that sound?

    • Doug, I can’t thank you enough for doing the calculations. I was rather hoping it would be around that much. We have always managed to “live happy” over the last 30+ years, balancing a modest lifestyle with our artistic leanings. And we think we could definitely “retire happy” on approx $28K per annum of CPP/OAS/GIS (with some TFSA savings for emergencies and incidentals). We already had our extensive travel years in our youth, so we’re looking forward to quiet times in our small paid-off home and studio 7 or 8 years from now. Thanks again!

  17. Jess
    You’re more than welcome! It sounds like you’ve got your priorities right, so congrats and good luck in your future. :)

  18. I came back to Canada 9/5/2004 from the States! I had no idea that I would need proof of my entry back into Canada. I went back to the border to see if they would stamp my Canadian passport, and they refused. How am I going to prove I have been here for 10 years without that? Someone told me I needed proof! I have worked the last eight years, and will retire at 65 in two years. I have my taxes for all years, and worked at the same job for seven years. Not sure what to do when my time comes..I can’t collect from the other side as I didn’t work while I lived in the States except for a few years, and don’t qualify there either. Any information would be appreciated! Louise

  19. Louise
    I wouldn’t worry too much about what to use as proof. The government is pretty reasonable about what they might accept, and the main thing might be that nothing contradicts your dates. Things that they might consider are lease or purchase agreements for your housing, a letter from your employer(s), utility records, tax returns etc.

  20. Doug,

    I have worked every summer in Canada since I was about 12 years old through high school and every summer I was at university contributing to CPP etc…Then after I graduated from university in 1989 I worked full time till 2000 when I left Canada to work abroad. If I return to Canada in 2015 at the age of 55 with my wife 43 who is not a Canadian citizen and who has never lived in Canada what sort of benefits will I be eligible for in Canada assuming both I and my wife work till the age of 65 once back in Canada?

  21. Sam

    Sorry that it’s taken me a few days to reply. Let’s look at your CPP entitlement first. As you’ve perhaps read elsewhere in this Blog, CPP at age 65 can be estimated at about $25/mth for every year (up to your best 39 years) that you’ve made max earnings and contributions (Year’s Maximum Pensionable Earmings, or YMPE).
    For yourself that means that if your 11 years of contributions from 1989 to 2000 and your 10 years from 2015 to 2025 were all at the YMPE, those years alone would be worth about $525/mth at age 65. You wouldn’t have contributed for any of your work prior to age 18, so if your part-time work for the 11 years from 1978 to 1988 was at approx 1/4 of the YMPE, those years would equal 2 3/4 years of YMPE and would net you an additional $68.75/mth of CPP at age 65 .
    For your wife, if she contributes for 22 years from age 43 to age 65, she would qualify for a CPP retirement benefit of approx $550/mth if all of those years are at YMPE, and proportionately less if under YMPE.
    For the Old Age Security (OAS), it’s earned at 1/40th of the maximum (approx $540/mth) for every year of residence in Canada after age 18. Your total of 32 years would therefore give you about $432/mth and your wife’s 22 years would give her about $297/mth.
    Hope this helps?

  22. Is the amount of GIS one can get according to number of years in Canada? I sponsored my parents here, and they will be here 10 years next year. Assuming their income is nil, what amount will they get in OAS and in GIS, and will this increase as they live longer here, e.g. in year 11, in year 12, etc? They are both 80 years old.

  23. I work in Canada on a contract basis but I am considered as a non resident tax payer. From what I can see is that as I am paying tax I should therefore be paying CPP contributions. My question is that I do not know if I will be working in Canada till retirement age, So if I for example only contributed for 5 years and then stopped working in Canada do lose the money I put into the CPP or is it kept till 70 years of age and then paid out?

  24. Andre
    I can’t answer your question as to whether you should be paying CPP contributions, as that is a Revenue Canada Taxation question. For the most part however, CPP contributions are not optionable. Either your earnings are considered contributable and you must make contributions, or they aren’t and you can’t make contributions.
    I can answer your questions on benefits however. If you make even one valid contribution to the CPP, you will be eligible for a retirement benefit. It is not paid to you automatically at any age though. You must apply for it and you can do so as early as age 60. A rough estimate for your benefit would be $25/mth at age 65, for every year of earnings & contributions at or above the yearly maximum (YMPE). If you apply before or after age 65, that amount is adjusted down or up by an actuarial adjustment factor.
    What you may not qualify for under the CPP is the disability and death/survivor benefits, as they both require contributions for more years (it’s slightly complicated). Depending what other countries you have lived and worked in though, you may even qualify for those CPP benefits if you have sufficient credits in those countries to meet the minimum requirements through what is called “totallizing” your contributions to both countries.
    I hope this answer helps a bit, but your first enquiry should be to RCT to find out if you must or may contribute to the CPP, based on your earnings and your status in Canada.

  25. Hello,
    How is GIS calculated: does it depend on your savings or only on interest from them? Does it mean that one can have savings and other investments but doesn’t have any income from them, will a person receive GIS?
    Thanks, Allan

  26. Allan
    GIS is based on income only, and not on assets. So yes, as you suggest, if someone has investments but doesn’t have any income from them, they could receive max GIS. Unfair perhaps, but that’s the way it is.

    • You are right, Doug. This is unfair to GIS to people who never contributed in Canada. You work all your life and just get CPP (far from full amount) and OAS and you can end with $1000-1200. And people who never contributed make $1350. This system work perfect in Austarlia. Everybody gets $500 and then… if you paid contributions, you can get a lot, if not – just $500.

  27. Allan
    Not exactly why I considered the GIS to be unfair, and not exactly correct. GIS is only reduced by 50 cents on the dollar for any CPP benefits received (or any other income), so you would always be better off to have worked and contributed to the CPP than not.

  28. Hi
    I have an Ont. govt. pension of $3100/month and took my CPP at age 60. I am turning 65 next July and wonder what I can expect from the OAS. (if any) Thanks. Rick

    • Rick
      You left out the critical details of how long you have resided in Canada, but for purposes of responding I’ll assume that you have lived here for at least 40 years after age 18 (probabaly a safe assumption based on your Ont gov’t pension amount). If that is true, you will be eligible for the max OAS of approx $550/mth. The “clawback” doesn’t start until your income (excluding OAS) exceeds approx $70,000/yr, so you shouldn’t have to worry about that unless you have significant income that you haven’t mentioned.

  29. I am applying for CPP and OAS pension. I turned 65 just over a month ago. My CPP benefits are supposed to be around $690 per month and I am assuming that my OAS will be $544. My wife’s will be around the $200 mark for CPP. We are both working and will continue to do so. Will she also be eligible for OAS at the $544 level when she turns 65 next summer? I will continue working full time and she is working half time.

    • Hi Don,
      OAS is based on residency. If she was resident of Canada for 40 years between the age of 18 and 65, she is likely to get maximum OAS. You can call Service Canada to see how much OAS she qualifies for.
      Jim

      • Thank you for your reply, Jim. Based on your reply she should qualify for the maximum as she has lived in Canada all her life.

  30. My pension on retirement will be approximately 80,000 (72 private + 8 CPP); My wife just CPP will be 2700 ; As you would expect we are splitting income on our tax filing therefore we will both be claiming approximately 41350. The claw back on OAS begins at around 70,000; would I be effected? Is the clawback based on your income tax filing?

    • OAS clawback is based on individual income, not combined income. If you split your income properly and keep your income below the $70,000 threshold, you should not be affected.

  31. I am 64 and my wife is 61. I looked at the tables and if I receive full OAS at 65 and qualify for GIS, my benefits will be $X. If my wife qualifies for the Allowance (she has not lived in Canada for 10 years and would have to use U.S. credits under the tax treaty), my GIS would be reduced, to make up for the amount she would receive. My question is: is she required to apply for the Allowance? The amount we as a couple would receive looks to be the same, whether it all comes in the form of OAS and GIS to me, or whether she gets part as an Allowance.

    • Alf
      The GIS/Allowance rate tables are complex when a partial benefit is involved, but if you are correct in thinking that the net benefit is the same either way, there is no requirement for youe wife to apply for the Allowance. I would however recommend that you confirm those calculations with SCC.

      • Thanks. Now I’m completing the GIS application and a couple things are unclear: 1. for U.S. Social Security, do I put down the total I received, or only the 85% that is taxable in Canada (under the tax treaty)? 2. My spouse and I are pension splitting. Do I have to make note of that anywhere?

        • Alf
          I believe that GIS will be based on your total U.S. Social Security, but I would include a note about the lower taxable portion just in case. Because the income that you report will be compared to what you declare on your tax returns, I would clearly note who actually received the pension amounts, and that you are splitting it differently for income tax purposes.

    • My wife applied for the Allowance 14 months ago. She has called Service Canada several times to check on the application, and was told that the delay was caused by needing U.S. credits to make up about 6 months of the 10 year residency requirement. When she called on Friday, she was told that the U.S. credit inquiry was just sent to Social Security two days before! She was also told that they asked for information from Citizenship & Immigration Canada at the same time. My wife sent a true copy of her landing document with the application and nothing else was requested. Can Service Canada request information from CIC without my wife’s permission? I thought they required a consent form for that. Any idea what information they need from CIC?

      • Alf

        I know that it takes a long time to process applications that require any of the international agreement, but 14 months to even request those records from the U.S. is ridiculous. My apologies for the bungling by Service Canada.

        I’m not sure what kind of information-sharing agreements there might be between Service Canada and C.I.C., and I can’t imagine what they would be wanting from them if you’ve already provided a copy of her landing document?

  32. I am retiring in July 31, 2013 (60 years old); I am presently employed where I pay the maximum CPP and Unemployment insurance by the month of June. Will I get a rebate for the five months (Aug 1 to Dec 31)?

    • Allan
      I have no knowledge of the EI, although I’d be surprised if you would get a refund of those premiums. As for CPP, prior to 2012, you would have been eligible for a refund if you applied for your CPP retirement at age 60, as that would have been the end of your contributory period. Your max contribution would have been 7/12ths of the YMPE, and you could have claimed a refund on your 2013 tax return.
      Since 2012 however, you are required to continue contributing on any employment earnings until age 65, regardless whether you apply for your CPP retirement pension early or not. If you do apply for a retirement benefit effective Aug 2013, 7/12ths of your 2013 earnings should be used to calculate your early retirement pension, and the other 5/12ths should be used to calculate a post-retirement benefit (PRB), which would be payable effective Jan, 2014.

  33. I have read here a number of times that it is necessary to have 40 years in Canada to receive full OAS. But isn’t there another way of qualifying, which is to have been born before July 2, 1952, and lived in Canada for some time…even briefly…as an adult (over 18), and to have lived in Canada for the last 10 years? I think this means that someone who left Canada in his or her 20s, then returns to Canada to retire, can get full OAS after being here for 10 years. It’s important that they know not to seek OAS before they have those 10 years, or they’ll just get a partial pension. (But they can make up for missing years in the final 10, with years in Canada after age 18, at the rate of 3 old years = 1 new year.)

    • Frank
      You are basically right in what you say, and thanks for pointing this out. There should be no concern however, if someone who can qualify for the old or new rules (ie., someone who had attained the age of 25 by July 1/77 AND resided in Canada on that date or had prior residence in Canada after age 18 or possessed a valid Canadian immigration visa on that date) applies before they had the “magic 10 years”. Such a person would always be given a choice between taking an immediate partial pension under the new rules, or waiting until they qualified for a full pension under the old 10-year or 3-for-1 rules.

      • I applied for OAS based on the above formula (born before 1952, lived in Canada before 1977, lived in Canada last 10 years). I’m one year short of 10 years back in Canada, and was hoping to use the 3-for-1 rule to make it up. I received a letter from Service Canada stating that my application can’t be processed until I prove my departure date from Canada back in the 70s. Since I’m a dual U.S.-Canadian citizen, there was no immigration involvement on either side of the border. I’ve read of cases like this where immigrants (though I’m not an immigrant) are refused a pension, because they can’t show plane tickets from 40 or 50 years ago, and that was one of the options given to me. I don’t have plane tickets, because I simply drove across the border. All I could think of to send to prove that I arrived in the U.S. was acceptance at a U.S. university (but that occurred in the following year) and a U.S. Social Security statement showing that I started contributing in the year I left Canada. I also provided the name and address of a U.S. citizen who knows when I crossed the border. Any idea if that will be enough?

        • Frank
          All you can provide is what you’ve got, so I suspect that might be enough. If you’ve been in Canada for the last 9 years, all that you should have to establish is that you had at leats 3 years of prior residence in Canada. Is your actual departure date that critical in coming up with those 3 years, or do you clearly have much more than that?
          Good luck!

          • Just a followup: I called Service Canada and was told that a full pension had been approved to start the month after my 65th birthday. (They didn’t event contact the person I gave as a witness.) So…everything turned out well. Thanks!

  34. Thank you so much for very useful information here. I wonder if there are any conclusions regarding what is more beneficial for a couple not married, both in Canada all their lives, 4 years apart, with no income past 60 years of age, to apply as two singles or one common law? I assume this is legal to do, since we file taxes as singles. Many thanks, Gabe

  35. Gabe
    You ask a very good, but difficult question.
    First, let’s look at a definition with the OAS act of a “common-law” relationship (CPP definition is similar):
    common-law partner”, in relation to an individual, means a person who is cohabiting with the individual in a conjugal relationship at the relevant time, having so cohabited with the individual for a continuous period of at least one year.
    So, you’ll have to decide whether that definition allows you to choose or not.
    As to your marital status and net CPP/OAS benefit, there is no difference to CPP, except that whoever lives longer might be eligible for a survivor’s benefit if you claim yourself as common-law. As for OAS/GIS, you would normally be better off claiming single once you’re both age 65, but you might be better off claiming common-law when the oldest reaches age 65, as the younger one could then be eligible for Spouse’s Allowance.
    So, the choice isn’t as simple as you might think!!!

    • Thank you Doug, your kind input it reinforces my own calculations of reporting a common law spouse, since I turn 65 and she is 4 years behind.
      And, after a 35 year period of cohabitation, the choice becomes obvious…..

      Thank you for taking the time to help people!
      Gabe

  36. I am 65 and still working, having spent the previous 21 years as a Canadian resident. My husband has just become a Canadian resident and his only income is a small pension ($6000 / year)from his country of origin. As yet, I have not applied for either CPP or OAS and intend to keep on working for a year or two. Service Canada calculates my current CPP as $4200 / year and OAS as $3600 / year. Is it worth deferring application for CPP/OAS until I finish work? I calculate I will generate around $6000 / year from RRSP savings and also have some non-registered savings. Is GIS a possibility for us?

  37. Elizabeth
    You have a very interesting scenario! You haven’t said how much income you receive from working, but based on what you have indicated, I think your plan to defer both CPP and OAS is a good one, at least until you decide to retire.
    As for CPP, your current estimate of $4,200/year will be going up by 0.7% each month that you delay, based on your increasing age alone. Depending on your employment income, it could also increase by about $300/year for each subsequent year of contributions that you make.
    For OAS, if you currently have 21 years of Canadian residence, you are eligible for 21/40ths of a full OAS. For every full year that you wait before applying, you accumulate another 1/40th, or about 5% of your current OAS estimate. Starting July 2013, you will also benefit from a 0.6% increase in your OAS for every month that you continue to defer your application for OAS.
    As for GIS, it’s unlikely that you will be eligible, at least while you’re still working. Once you decide to quit however, that will be a better time to look at when you should apply for CPP and/or OAS, and whether you might be eligible for GIS based on your income at that time.
    I hope this information is sufficient for you to decide what to do for now, but if you want more detailed calculations on your CPP options, you would have to email me at DRpensions@shaw.ca with your detailed CPP statement of contributions.

  38. Just a quick question guys. My dad turns 65 in 3 years. He is currently getting CPP since he was 60, but at a very low rate. We are selling our current house and he is thinking of purchasing a condo. Would the government factor in that you own a property and reduce your OAS + CPP + GIS since you are paying less a month (maintenance fee + hydro = $500) as oppose to renting a place at like $1300. He would have little income, since if he does not buy the condo, he would assist me with the money for my place. Thanks!

    • Tom
      Whether your dad owns or rents will not affect the amount of his CPP, OAS or GIS entitlement. The only possible impact if he sells his current home would be if he invested the proceeds and generated some income that might reduce his GIS entitlement. From what you say though, that’s not his plan.

      • Thanks Doug for the clarification, really appreciate you taking the time to response to everyone’s questions in here.

  39. Hi Doug: Presently I’m retired– receiving a modest pension from my employer. My husband, a number of years older, has a good pension. I also work on-call, and contribute to the CPP still. I’m 64, and my question is: I feel so guilty applying for OAS or CPP because of the perceived monetary situation of the funds, plus shows like “Money Talks” which discuss our taking for granted what we get from gov’t and how the “free” ride can’t keep going. Should I apply to start these pensions at age 65? (I’m in very good health). Thanks.

  40. Jean
    I’m not sure whether you’re asking whether you should apply at age 65 versus waiting until a later time when your benefits will be more, or whether you shouldn’t apply at all?

    If your question is the latter, I’m not one of those who feels that there’s any guilt in applying for either CPP or OAS. CPP benefits are financed directly through your contributions, and OAS is financed through federal taxes which you’ve probably paid your fair share?

    If your question is the former, you should check out these two articles:
    http://retirehappy.ca/cpp-for-the-over-65-and-still-working/
    http://retirehappy.ca/voluntary-deferral-of-oas/

    If you want accurate calculations of your CPP at various ages to help you decide when to start receiving it, email me at DRpensions@shaw.ca, and I can help you (for a fee).

  41. Jean

    I thought that I replied a couple of days ago, so my apology for the delay in this response, and my further apology if a 2nd similar reply eventually shows up!

    It depends on whether you’re question is whether you should apply for your OAS and CPP at age 65 versus waiting until later to receive higher benefits, or whether you shouldn’t apply at all because you don’t need or deserve the benefits?

    If the former, I would suggest that you read these two articles, and then get back to me if you still are uncertain:
    http://retirehappy.ca/cpp-for-the-over-65-and-still-working/
    http://retirehappy.ca/voluntary-deferral-of-oas/

    If the latter, I don’t believe that you should feel guilty about applying for either your CPP or OAS benefits. You paid for your CPP directly through your contributions and you paid for your OAS indirectly through your federal tax dollars. Both benefits are taxable, so you’ll be refunding more of that money back to the government if you’re in the higher tax brackets, and the OAS even has a specific surtax if you’re in that income range. So again, no guilt!

  42. Hi Jean,

    Your say you’re receiving an employer based pension already and I assume you have no guilt about it. (Rightly so). The CPP is an employer based pension not a government pension. Whats the difference? I believe Michael Campbell is near 65 and I have no doubt he will collect any CPP…. and he should IMO.

    Dougs info is all correct except in my opinion regarding OAS when he says you PAID for it. There is no money set aside to pay for OAS so we’re all PAYING for it. The problem Michael Campbell points out is this and the explosion of those reaching 65 with life expectancy so much longer now. Currently 2 age 65 people start collecting OAS for every 1 over 65 who dies.

    I think more correctly, you paid for other seniors during your working years to have OAS and now its your turn to collect. Notionally though, we are still paying for long dead seniors OAS pensions, as some portion of the national debt must have been previous OAS payments.

    Its just like health care, we paid for others and now as we grow older we need/expect more health care. But because of large ever increasing seniors population the numbers won’t work. You won’t have to feel guilty about not using health care we’re all going to get a whole lot less of it. So if you don’t want the OAS, save it to pay your health care later.

    Dave

    • Dave

      Good to see you back here again! You seemed to have disappeared for a while?

      I’m OK with your interpretation of the OAS financing, but I’m also OK with believing that just because the government used my tax dollars for other purposes when I gave it to them (rather than holding it in a separate account for me) doesn’t mean that I didn’t pay for my own OAS.

      The main point that I think we agree on though, is that Jean shouldn’t feel any guilt in applying for her OAS at age 65, or waiting past age 65 to receive even more at a later age.

  43. Hi Doug,my dad has been approved the OAS, and he also waiting for GIS approve, my question is his EI benefit just approve at july, (he apply at march) however, if he received EI now is affect the GIS qualify?
    So should he stop to receive EI,? So headache at this point.. Thank you.

    • Mabel

      If your dad has been approved for EI, it might reduce his GIS but only by about $0.50 for every $1.00. So, he’s still better off receiving any other money that he’s eligible for.

      Also, GIS is normally paid for one fiscal year (July thru June) based on the previous calendar’s income, so any EI that he receives now wouldn’t normally affect him immediately. Plus, when the EI stops, he can be paid on his estimated income after that time, so it might not even reduce his GIS at all.

  44. Would anyone be willing to talk to me about my alternatives one-on-one? I’m so confused and desperately need to put plans in place!

  45. I’d like to thank you for the efforts you have put in
    penning this site. I am hoping to view the same high-grade content by you later on as well.
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  46. I took early cppp at 60 yrs old/ I now receive cpp apx 435 am nth and OAS apx 546 a month I am going to be laid off thisyr I am 66 and will be collecting EI for 36 weeks at apx 485 weekly I hav ealso withdrawn 6000. from my rrif this year Can I qualify for gis in 2014 If so would you know how much?

  47. Michele
    You haven’t indicated your marital status, but if you’re single you won’t be eligible for GIS until your EI payments stop. At that time, you will be eligible for GIS based on your estimated yearly income after that date. It’s a bit of a guesstimate, but I think your GIS might be as much as $470 monthly (in addition to your OAS), again assuming that you are single and have no income other than CPP in 2014 after your EI stops.
    If you have another RRIF withdrawal of $6,000 in 2014, that will reduce your GIS by about $250 per month.

  48. Thanks so much for the info. I call GIS today and I understand gis is deducted dollar for dollar of the amount of rrif withdrawls. Also they said it takes about 30 weeks to process a gis request. I was told by them today that I should fill out a 2014 estimated income in march 2014 and an estimated income for 2013 now. Its all very complicated. Can you clarify the procedure and wait time–30 weeks sounds like a very long time to wait for a decision in 2014, They also told me that I probably would not qualify for any money in 2013 because of the 6k rrif I withdrew in 2013 Even though they deduct salary and ei in their calculations, my income would still be apx 16k for 2013 disqualifying me for the gis.. Should I withdraw more now and save it for the 30 week waitng time in 2014, as I will only have about 1000 a month to live on after the EI runs out? I don’t want to withdraw in 2014 as that will affect the gis payment again By the way I am single.

    Thanks Again for all of your help

    • Michele
      GIS is NOT deducted dollar for dollar for RRIF withdrawals. RRIF income is treated the same as any other income and is deducted for the most part by 50 cents on the dollar.
      I can’t comment on the processing time, other than to say that another client (in BC) was told 20 weeks and it actually took about 10 weeks. I’m sure that it can vary by province, but it is what it is.
      I wouldn’t bother completing the 2013 estimate form, as your EI will be pro-rated and will make you ineligible (even without the RRIF). I would wait until your EI stops, and complete the estimate form then.
      Your plan to withdraw extra RRIF moneys in 2013 is probably a good one from a GIS perspective, but you’d also have to consider how that might affect your 2013 taxes versus 2014 taxes.

  49. Hi,

    Thanks for your very informative blog.

    I lived in Canada for almost 15 years, from Sep 71 to April 86, came as a student, became landed in 72, citizen in 75, worked starting 72,contributed to CPP, moved to US in 86, worked there and am living there till now. Just turned 65

    Want to know:

    1) how much CPP I may expect
    2) how much OAS I may expect
    3) how much GIS I may expect if my adjusted gross income (myself and my wife) is below US $20K all of whioh is from rentals and not employment
    4) whether I need to report to social security organization of respective country that I am receiving social security from the other
    5) and if so, how are social security payments (CPP/OAS/GIS Canada) SS (USA) affected by such disclosure, or it doesn’t matter as the amounts will show up in the tax return
    6) whether I need to file Canadian Tax Return for Canadian social security payents that I’ll be receivimg as I am now a permanent resident of the US
    7) will my combined 42 years (15 in Canada, 27 years in US) entitle me to full (42/40) OAS ( under Totalization Agreement)?
    8) would it be to my advantage to get the Canadian payments in US dollars direct deposited to a US bank, ignoring for now FX implications, or direct deposited to a Canadian bank taking into account tax witholding and other charges for non-resident Canadian
    9) would it be to my advantage to move back to Canada, get residency and get full benefits of a resident Canadian(not sure how they compare to a non-resident status)
    10) How does the Services Canada pro-active enrollment affect my initiative/requirement to apply on my own (online or otherwise)

    Looking forward to your reply. Many thanks in advance

    SA

  50. Shaw
    Lots of questions, but I’ll do my best.
    1) If all of your 14 years of CPP contribution were at max, your CPP would be approx. 14/39.5 x $1,012/50 = $358.86.
    2) If you resided in Canada for “almost 15 years”, you will be eligible to 14/40 x $550 = $192.50 (see also #7).
    3) You can expect $0.00 GIS, as you aren’t residing in Canada.
    4) You don’t have to report your US SS to Canada. Can’t tell you the other side of it.
    5) CPP and OAS eligibility and entitlement aren’t affected by US SS eligibility.
    6) I don’t think so, but you’d have to check with Revenue Canada to be sure.
    7) No! Totalization can be used only to meet the minimum 20 year residency requirement or you wouldn’t be eligible for OAS at all. It doesn’t increase your 40ths.
    8) Couldn’t tell you.
    9) Too big a question.
    10) It won’t affect. You must apply if you want to receive either CPP or OAS.

  51. Could you please tell whether or not the savings I have in the bank will affect how much I receive in my Old Age Pension or the supplement? Thank you.

    • Rick

      It is the interest paid on any bank savings that you have that will affect your OAS, but only if your net income is over the threshold for the “clawback” ($70,954 for 2013). The OAS clawback rate is 15% on income above that threshold amount. See Jim’s article on the OAS clawback for further details: http://retirehappy.ca/minimizing-old-age-security-clawback/

      If your income is low enough to qualify for GIS, most types of income (including bank interest) will reduce your GIS entitlement. For the most part, GIS is reduced by $0.50 for every $1.00 of such income that you receive.

  52. On the application form for OAS/GIS, my income is negative and my wife has a positive due to split pension, her only income. We completed ISP 3025 , but they say since my income is set to zero, leaving my wife at positive, we are penalized. Why bother with ISP 3025 ?

  53. Hi … working or school all my life … full-time employment w/ max. CPP contrib. for only 271 months. All my life lived in Canada. I’m 58 and wife 50 (she has always been self-employed so no CPP contrib.) Her gross inc. ($35,000) and net inc. ($23,000). We have other inc. of $23,000/annum until 2030 (gov’t solar contract). Currently I’m employed and contrib. max. CPP contrib. If I want to retire at 60 (ie quit working) but collect CPP at 65 and my wife works until she is 55 but collects OAS/GIS at 65. Can you kind of guessimate what I would collect at 65 (7 yrs from now) from the gov’t in total and then what my wife would get when she reaches 65 (15 yrs from now)?

    If not then any suggestions how we can figure this out based on the current rules? Don’t want to go to financial planner b/c we think a lot of them have their own hidden agenda (promoting some financial vehicle).

    Thank you for considering the above. Sincerely, Daryl

  54. Hello, Please tell me the following: what is the max amount of CPP, OAS and GIS combine a single person and a couple can get starting 65. CPP and OAS will be around $800 for husband and $800 for wife. I just want to know the difference between single person and married couple. Thanks a lot

  55. Allan
    I don’t understand your question. You ask what the maximum CPP, OAS and GIS would be, but you stipulate that CPP and OAS are $800 (far below the max).
    Is your question really how much GIS is payable to a couple with $1,600 OAS & CPP versus a single person with $800 OAS & CPP?
    If that is your question, I can only answer it if you tell me what portion of the $800/$1,600 is CPP and which portion is OAS (are they receiving full or partial OAS), as the CPP is counted as income for GIS purposes and the OAS isn’t.

    • Doug, you are correct. here are the numbers.
      CPP – $400, OAS will be $450 – one person at65
      CPP – $450, OAS will be $450 – another person at 65

      How much GIS they will get as a couple and separately when without additional income?
      Thanks

      • Allan
        GIS for anyone receiving a partial OAS ($450 would be approx. 33/40ths of full basic OAS) are based on a complex set of rate tables that I don’t have access to, so the only answer I can give is based on full OAS. The actual amounts of GIS if they’re receiving partial OAS should be a little higher, but you’d have to call Service Canada if you want the precise amounts.
        Based on receiving full OAS:
        – a single pensioner receiving $400 CPP would be eligible for GIS of $496.19;
        – a single pensioner receiving $450 CPP would be eligible for GIS of $471.19;
        – a couple receiving $850 CPP would be eligible for GIS of $249.72 each, or $499.44 in total

  56. Thank you Doug. I have a question for you. As far as I understand, CPP contributions don’t change your pension for better. An example: take two people living 40 years in Canada. One worked hard contributed all his life and by 65 his CPP is $800. The other one worked occasionally, had his business writing all expenses, many years didn’t work, worked under the table etc and his CPP at 65 is $100. At 65 both of them will get the same $1350 (approx.)pension. Am I correct?

    • Allan
      Not at all! GIS is only reduced by about 50 cents on the dollar, so using the examples that you’ve given, the hard-working person would receive about $1,650 ($800 CPP, $550 OAS and $300 GIS) versus about $1,350 for the other one ($100 CPP, $550 OAS and $700 GIS).

  57. Hello Doug,
    This is off topic but this is insane. One person pays taxes, EI, CPP all his life and tried to save some RRSP. And at the end with some interest from his savings and RRSP he gets $1350 like other guy who pays almost nothing, gets $700GIS, have all his money due to different combinations.
    Everybody has basic in Australia – $500. and then depends how much you contributed in your life time. Didn’t contribute anything, so $500 is your max… It calls stimulus…

  58. Hi Doug,

    Is that true that $3500.00 (maximum) as extra income won’t effect my old age income and my CPP?
    Thank you for your help.

    Samantha

  59. Hello doug,
    My dad is receiving the GIS since last year at oct (he was 65 at july) ,so my apply allowance at last year oct last year, she is already 60 from feb 28, but now still not reponese , do you know how long she will have result normally ? Thank you!

  60. Hello doug,
    My father was receiving the GIS now, and also my mom apply the allowance at last year oct, she is 60 at feb 28 2014, so do you know when will she get a reponese and what is the maximun time waiting ?
    Thank you.

  61. Mabel

    Her first Allowance cheque should be payable at the end of March (month following her 60th birthday), but she should likely have heard something by now.

    I would suggest phoning Service Canada at 1-800-277-9914 to make sure that they have at least received her application and to see if they need further information or documentation.

    • Hi Doug,
      My mom is still not get any letter,should she call them or wait til Apr 17,(because she apply in person at oct 17)?
      Thank you.

      • Mabel

        I wouldn’t wait another day before calling!!

        She should have received her first payment already if she’s eligible, and she should have heard before now if she’s not eligible or if they’re waiting for further documentation.

  62. I am a Canadian citizen, but have never lived in Canada or made any income in Canada. I do plan on retiring in Canada is there any benefits that I can receive? I currently live in the US.

    • Dave

      You will begin to qualify for the Old Age Security (OAS) once you start residing in Canada. Each year of residence in Canada is worth 1/40th of the full basic amount (currently about $550 monthly). You normally need at least 10 years of residence in Canada to qualify, but you may be able to qualify sooner under the Canada/USA social security agreement.

      As far as the Canada Pension Plan (CPP), you’re only eligible based on earnings in Canada where you’ve made CPP contribution. If you don’t make CPP contributions after you come to Canada, you won’t qualify for any CPP benefits.

  63. Hello ,

    Am islam born in quebecin 26/7/1987 am now 27 years, i leave in egypt. I didn,t recieve any monthly canadian benefiets before .
    I have some question:
    1. Do i have benifites for the previous 27 year?
    2. If i have how can i recieve them?

    Note:am now working from 2009 until now

    Thanks,

    • islam

      If you worked and contributed to CPP for any of those years, you will be eligible for a retirement pension when you turn age 65, or a reduced amount as early as age 60.

  64. Hello,
    My husband and I both collect CPP – 700 and 675. My question is, my husband turns 65 in two years, and I will be 62. When my husband starts getting OAS then will I be eligible for anything until I reach 65?
    And when we are both 65 and have only this income and OAS, would we be eligible for GIS? Thanks so much. I did phone Service Canada but it is always hard to get info.

    • Dee

      Based on your current CPP amounts and the current OAS rate tables (and assuming that you both have at least 40 years of residence in Canada after age 18) here is what your entitlements would be.

      When your husband is age 65 and you are age 62:
      – he will have OAS of $551.54 and GIS of $300.72,
      – you will have an Allowance of $300.72

      When you are both age 65:
      – you will each receive OAS of $551.54 and GIS of $116.72

  65. Hi

    My dad is currently collecting partial OAS. My mom is not a Canadian citizen and currently reside oversea. My parents are still legally married.
    As far as I understand, GIS is calculated based on the marital status.
    I am just wondering if my dad is considered as single or married in this case. Based on the fact that my mom is not a Canadian resident, how can I complete the GIS application form for my dad? Do I need to print my mom’s name, attach the marriage certificate and have her signed on the form? Or simply write non-resident under her name.
    I have talked to the staff at Service Canada office but they are not really helpful.

    Thanks.

  66. Ivy

    The answer to your question depends on the circumstances of your parents’ separation.

    If the separation is due to a marital breakdown, your father could be considered as single three months after the separation began (even if they’re not “legally separated”), and there’s no need for your mother to complete any form for his GIS purposes.

    If, on the other hand, the separation is temporary and is considered as “involuntary” (e.g., due to financial, health or other reasons), then your father should claim married status for GIS and your mother’s income should be reported.

    I hope this helps?

    • Doug, thank you for the clarification.
      My parents have been living apart for years due to financial reason(?). Back then, My mom was unwilling to give up her job back home. Even now she is retired, I don’t think she is planning to apply for Canadian citizenship again. I am not sure if this falls into the separated status category.
      Now my question is…. When my dad filed his tax for 2013, he stated he is married. Would there be a problem if he applies as single for GIS (which the marital status did not match the tax return for 2013)?
      Thanks again.

      Ivy

  67. Ivy

    Only your parents can truly decide what their relationship is now.

    Some of the questions that might help define their status would be:
    – Do they ever hope to live together again?
    – Do they continue to share their finances etc, or do they maintain separate lives and they just haven’t taken any legal steps to end the marriage?
    – Have either of them had a common-law relationship since the started living separately?

    Once he decides what his marital status is, your father should certainly be consistent in how he claims his marital status, especially to various government departments. He can’t simply claim to be married when that is better for him, but separated when that is better.

    For instance, what will happen when one of them dies? Is there an expectation that the other will be eligible for survivor’s benefits?

  68. My CPP is $350.00 a month, and I’ll receive full OAS. I have a Lif and I receive about $3600 a year. I average about $600 a month (part-time job). My income for last year was around $13, 500. Never been married or partnered. Will I receive GIS. If so, about how much? Thank you.

  69. I have been told that someone who has never worked will end up with the same amount of income as someone who is getting cpp retirement old age and income supplement is this true. as of june 14 this is 1,261.00 per month.

  70. Sonnycat

    You are quite misinformed. Firstly, as of July 2014 the basic OAS is $558.71 and the maximum GIS for a single person is $757.58, bringing the total for those two benefits to $1,316.29. That is the least that anyone who has lived in Canada for at least 40 years after reaching age 18 should receive at age 65.

    If they worked and contributed to CPP, they would receive more than that amount. While it’s true that someone receiving CPP wouldn’t receive the maximum GIS, they would still be ahead by approximately half of the amount of their CPP.

  71. Doug – your knowledge is such an asset for many at such times as that approach to Retirement Life.
    With me – it has been several years of illness and depending on the support of a working spouse thankfully to get us through.
    I am weeks away from my 65th Birthday and am very vague about finances will be coming together for me. My wife and I had been initially back in Europe a lot caring for elderly family – I am a Canadian Citizen since 1978 and am presently only receiving $61 cpp monthly. I have only lived in Canada 15 to
    16years. There should also be some pension eligibility from time spent in the UK.
    My wife is a Permanent Resident and will hopefully be applying for Canadian Citizenship next year. I don’t know if it is possible but is there some way I could use the very few years she has of cpp contributions towards boosting my meagre monthly sum? She will be 60 in two weeks time and has only 4 years of contributions so I don’t see her ever getting a payment from.Thanks for any advice.

    • Brian

      No, there’s no way to transfer your wife’s CPP contributions to increase your pension. She could receive her own CPP at age 60 though, and they will have the same impact on her pension as they would on yours, except that she’ll have the age-reduction if she starts at age 60.
      You should be eligible for OAS now, if you’re presently residing in Canada. If so, you may also be eligible for GIS and your wife might also qualify for the Allowance.

      • Doug – thanks for the response. I have been getting very little from CPP but considering that I had returned to UK to look after elderly family, and also that I developed major illness myself – I am no doubt getting what is due to me. However, I have recently applied for partial OAS and they have turned me down- I think they are questioning my residency years in Canada. I just wish that I had more evidence to show them but they are actually wrong – thinking me to be less than 10 years here when in fact I am close to 14 years. (I might have to turn to my local Federal M.P.)
        Thanks for your help. Brian

        • Brian

          Sorry to hear that you’re having problems with your OAS. Residence in Canada is sometimes a grey area, especially if you had frequent and/or lengthy absences and/or significant ties to another country.
          They should have advised you of your appeal rights though, so don’t hesitate to follow that route (in addition to contacting your MP) if you believe that you have at least 10 years of good residence in Canada.

  72. Hi, I am helping my parents to fill out all the forms and apply for anything they are eligible for. It so confusing, and I need help. My father is going to be 65 in May 2015, he was full time employee so he made maximum CPP contributions. He also has pension plan from Manulife at his work place. My mother will be 65 in 2016, she is self-employed and as per advise of her accountant never made any CPP contributions. They want to start their retirement as soon as my father become 65.
    I am getting confused with retirement sharing between spouses. I need to know if they should apply for CPP, OAC, GIS and allowance together or separately and which exactly forms to fill out in order for them to receive everything they are eligible for and to maximize their benefits.
    Please help.

  73. Anna

    I think you should contact Service Canada for some assistance, but in a nutshell:
    – they have to apply for their CPP separately, but they can share their CPP through a joint Assignment, if that would be an advantage for tax purposes;
    – they have to apply separately for OAS (Old Age Security);
    – they have to file joint income statements for GIS and the Allowance, but the benefits are paid separately

  74. Hi all … fascinating reading.

    I would love some advise. I just turned 60 and I am considering going for the early CPP. My employment is a mixed bag of working, child rearing etc.

    At 22 I had my first child and stayed home with her for 1 2/ yrs and had three children 1989 through 1995. Then a divorce and raising 4 kids on my own … not working. I am the person that collected the Baby Bonus / Child Tax Credit and will definitely be filing the ‘Child Provision’ and need to know:

    1) If they only calculate from 0 – 7 even for single parents?
    2) If they have my tax information, and if I have been collecting the child tax credit payments, why do I need copies of original birth certificates?

    My lawyer dropped the ball and didn’t tell me about my right to apply for split pension, though I also know that it is not too late for that:

    1) Does this mean that the split is for the years married, or does it include child rearing years and lost income and contributions?

    Question regarding early CPP:

    1) If you elect to take CPP early, does that mean that it is reduced for the 60 months of early CPP?
    2) The rest of your life?
    3) Does it pop up to normal rates at 65?

    I rec’d child support but it was non-taxable based on agreement, which means no contributions for all the years I stayed home with the 4 kids.

    Honestly, with such complex formulas I have no idea what I might expect to get at 60 or even 65 if I decide to wait. Any idea there?

    Is there anything else that I might be able to look into to up the amount?

    Thank you in advance,
    Andrea

    • Andrea

      Lots of good questions!

      To answer some of your basic questions:

      1) Yes, the child-rearing provision (CRP) just covers periods up until the child reached age 7, even for single parents.
      2) If you take your CPP early, it is paid at the reduced rate for life.

      If you have a recent copy of your CPP statement of contributions, I could do some calculations for you (for a fee) to help you figure out when to take your CPP. I can easily calculate how much the CRP will increase your CPP, and I can also calculate the impact of a credit split if you have a copy of your ex-husband’s CPP statement (or I can approximate it if you can estimate his earnings).

      If you’re interested in having me do any calculations for you, email me at DRpensions@shaw.ca.

      • Thanks Doug … I appreciate your response.

        I guess my first response is … what a rip-off that taking early CPP means a 32% loss for life. Also, that a woman who makes the decision to stay home and raise children is once again ripped off good and proper in this scenario. I guess my lawyer, whom I had to pay a fortune to was worse that I had already decided. This non-taxable child support situation worked great for my ex but has been a disaster for me in the long run based on what you have told me.

        Would you please let me know what the % per payment period, i.e.: weekly, bi-weekly or monthly they take for CPP?

        Even though I have worked in one capacity or another since I was 13, full time since 20 and until 36, because of such low wages in the early years and ‘old day’s my CPP is next to nothing.

        I really need to augment with the Split Pension and CRP!!

        A.

        • Andrea

          I’m not exactly sure what your question means, but if you’re wondering how they calculate and pay your CPP, the amount is 25% of your “average monthly pensionable earnings”, and it is paid monthly.

          I should clarify a couple of other points also.

          The current reduction for taking CPP early is 0.56% per month, or 33.6% at age 60. The reduction factor is increasing yearly, and will be 0.58% for 2015 and 0.6% for 2016 and beyond.

          Also, whether your child support payments were taxable or non-taxable wouldn’t have affected your CPP, as you only make CPP contributions on earnings from salary or self-employment.

          • Thanks again!!

            Would you please define what ‘pensionable earnings mean’ please? I’m guessing that its pretty straightforward and means your earning for the month.

            I will email you but the reason I am considering losing big-time and taking early CPP is because my financial situation is not good.

  75. Quite by chance I remembered that I had gotten something from the government last year and dug it out. Here’s what it says (which is an incomplete picture) and makes no sense based in your page where you explain that they calculate for inflation etc.

    Its pretty pathetic:

    IF I was 65 I would be getting 392.80; 60 – 260.82 and 70 – 557.78.

    IF you take that number, add OAS, CRP and PS .. what might I expect as a guestimate? Child 1976 ending 1983; Child 1989; 1992 and 1995 – ending 2002.)

    A.

  76. Andrea

    I’d need to know your year-by-year earnings to do an actual calculation, but since you can potentially drop out approximately 20 years under the CRP, your age-60 CPP could be as much as $500 (if you had zero earnings in all of those 20 CRP years).

    OAS is payable at age 65, and the full basic amount is $558.71 if you have 40 years of residence in Canada after age 18. You may also be eligible for GIS (Guaranteed Income Supplement), but I’d need more info to tell you if/how much.

    If PS means pension split, I can’t even guesstimate without much more information.

  77. You have been very generous with your time and I appreciate it.

    Over the two years there were two income reports totaling $54K.

    I am sure that I would quality for GIS when the time comes and I can see why it would be impossible to determine the PS and that’s something the government would have to do.

    Will you plz include your email in your reply as I’d like to know your fees for calculating the CRP and CPP.

    Thanks again,
    A.

  78. If my CPP is 450/mth and I receive full OAS (in 2015)I still can’t figure out if taxes will be owed.
    If I stay in the country I will also get GIS.

    If I head south (without GIS) will tax still be withheld if the CPP and OAS are my only income? non tax treaty country.

    Thanks
    jo

  79. Hi Doug
    I have recently applied for gis on an estimated income for for 2014 I was advised by them to empty my riff which was about 5000, so I did. They explained that the riff withdrawal would be forgiven as it is now at a 0 balance I enclosed the documentation to prove the 0 balance I hope they directed me correctly Do you have any idea? I currently receive 461 monthy cpp and max oas total monthly income apx 1000. How much gis do you think I may receive? The govt told me about 472 a month, I have trouble believing anything as they seemed confused and every time I call I get a different answer Please Help. Thanks Doug

  80. Michele

    The answer to your question depends partly on why you were being paid GIS on an estimated income, and whether you were making regular withdrawals from your RRIF until it was finally depleted or whether you simply made that one lump sum withdrawal to deplete it.

    If you were making regular withdrawals and you ultimately depleted your RRIF, that in itself could trigger being paid GIS on estimated income. If however something else triggered the estimated income and you coincidentally just made this one-time withdrawal from your RRIF, it will likely be considered as income after your estimate and will reduce your GIS.

    If you now have just the CPP income of $461, the quote of $472 for GIS is about right. If you receive less than that, they may be reducing it for the RRIF withdrawal and you may have to make a claim of “erroneous advice” to see if you can get it increased. In that case, hopefully you have the name of the agent at Service Canada that told you to make the RRIF withdrawal, as well as the date/time of your call.

  81. Thanks for your reply Jim. No I did not get the name or date of the person. I withdrew in 3 payments in 2014
    July 3500
    August 2000
    Sept 975,
    All of these amounts are gross amounts

    This is not good news for me for sure do they deduct dollar for dollar Is there ever exceptions to this rule? Would it affect my gis for Jan 2015 or only 2014? Thanks for your help. This is all so complicated yuk

    • Michele

      Did you have any other income that had stopped or reduced, or was the RRIF withdrawal the reason or trigger for the estimate? Did you also make any RRIF withdrawals in 2013, or were these 3 withdrawals the total amount of your RRIF?

      Income in 2014 would normally affect GIS for the period of July 2015 to June 2016, and it would normally reduce GIS by approx. 50 cents on the dollar. Being paid on estimated income makes the effect immediate though.

      My suggestion is to wait and see how much your GIS is, and then to enquire why if it’s lower than the $472 amount that you were told it would be.

  82. I can have a choice of taking one payment instead of monthly pension from my firm that I worked for some number of years. I will pay a lump sum tax on the payment. How does this one payment converts to ‘monthly income’ in terms of calculation of OAS and GIS?

  83. Hi, Doug, I am on LTD from workplace. As required by the insurer, I must apply CPP Disability benefits. I am currently 59 and would like to go back to work, possibly in 1-2 years. I heard that the CPP Disability benefit will reduce my CPP retirement amount (then without CPP Disability benefit had been received) in the future.

    Question:
    1) is the negative effect of collecting CPP Disability benefit on CPP retirement income true or false?
    2) When I am on LTD, I do not contribute to CPP; due to the lower amount of contribution my CPP Retirement benefit would be lower than if I had been healthy (and did not stop contribute to CPP). true or false?

    Please help – I have tried other places but have not got clear information.
    Jenny

    • Hi there,
      I am retiring at age 65 in 16 months. I took early CPP at 61 (I presently receive 746/mos) . I have no other pension as I have been self employed. I do have savings (RRSPs) worth 300k which at 4% would produce about 2800/mos for 10 years. The next ten years if I make it that far I would survive off the equity in my small condo. ( present value 225)
      What can I expect my CPP and OAS to be a,t 65. Approximately? I hear terms like claw backs etc and I wonder if I would be affected by them?

      • Ralph

        Your CPP at age 65 will be slightly higher based on four years of cost-of-living increases, but let’s say it will still be $746.

        If you have resided in Canada for at least 40 years after age 18, you will receive the “full basic amount” which is currently $563.74/mos.

        You won’t be eligible for GIS and you won’t be subject to the “OAS clawback” if the only other income you have is your RRSP income of $2,800/mos.

    • Jenny

      You have the situation completely reversed. If you are not contributing to CPP because you are disabled, these years of zero earnings will likely reduce your retirement pension if you don’t receive CPP disability, but it will be protected if you do receive CPP disability.

  84. hi great stuff here I love your advice,i was wondering, I am going to retire soon. I have a municipal pension plan,that I will get when I retire. I have a pension plan from my dear departed wife. I am collecting right now a combined survivor and my cpp pension.( I am 61). life is good. I was wondering when the time comes to collect OAP AT 65, I KNOW THE MPP BRIDGE WILL COLLAPSE ,BUT WHAT WILL HAPPEN TO MY SURVIVOURS PENSION?, WILL IT B REDUCED OR JUST FADE AWAY. YOURS TRULY DAVE

  85. I elected to take early CPP and am now collecting $240 per month. Can you please tell me how much GIS I will be eligible for when I am 65 and collecting OAS next year. I have no other pension income, RRSPs, etc. I have looked everywhere on the Revenue Canada site for the table to show how CPP is worked into the GIS formula. I understand being able to earn $3500 annual”employment income” and the GIS not being affected. Is CPP considered pension income and therefore GIS is reduced $0.50 per dollar or is CPP considered “Employment Income” and possible included in the $3500 allowance? Thanks.

    • Alex

      CPP is considered pension income and is not eligible to the $3,500 exemption for employment income.

      Assuming that you’re single, your combined OAS/GIS at age 65 should be about $1,190.14.

  86. Hi Doug

    Do you know the 2015 YMPE amount.

    I’ve been searching the internet but can’t find it. I thought it was announced at the beginning of Nov. ?

    Dave

  87. My wife applied for the Allowance 14 months ago. She has called Service Canada several times to check on the application, and was told that the delay was caused by needing U.S. credits to make up about 6 months of the 10 year residency requirement. When she called on Friday, she was told that the U.S. credit inquiry was just sent to Social Security two days before! She was also told that they asked for information from Citizenship & Immigration Canada at the same time. My wife sent a true copy of her landing document with the application and nothing else was requested. Can Service Canada request information from CIC without my wife’s permission? I thought they required a consent form for that. Any idea what information they need from CIC?

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