Seniors to Receive OAS Payments of $1,000 + $946 in January 2025, Know Eligibility and Payment Details

Canadian seniors will receive an enhanced Old Age Security (OAS) payment in January 2025, amounting to $1,946. This total includes a basic OAS payment of $1,000 and an additional Guaranteed Income Supplement (GIS) of $946 for those who qualify. This increase aims to provide much-needed financial support to older Canadians facing rising living costs.

What Is the OAS Program?

The Old Age Security (OAS) program is a government-funded pension plan that provides monthly financial assistance to Canadians aged 65 and older. Unlike the Canada Pension Plan (CPP), which is based on contributions during working years, OAS is funded through general tax revenue. This ensures that even seniors who have not worked or contributed to CPP receive financial support.

In January 2025, the OAS program will further support low-income seniors with an increased Guaranteed Income Supplement (GIS), helping them cover essential expenses like rent, healthcare, and groceries.

Impact of Rising Costs on Seniors

Inflation and increasing costs of living make it difficult for seniors to manage expenses. The increased OAS and GIS payments provide crucial financial relief.

For example:

• Higher food prices make grocery shopping more expensive.
• Rising healthcare costs mean seniors must spend more on medications and treatments.
• Utility bills and rent continue to increase, putting pressure on fixed-income individuals.

The enhanced $1,946 payment in January 2025 will help seniors cover these rising costs and maintain a comfortable lifestyle.

Eligibility for the $1,946 OAS Payment

To qualify for the OAS and GIS benefits in January 2025, seniors must meet specific age, residency, and income requirements.

1. Age Requirement

• You must be 65 years or older as of January 2025.

2. Residency Criteria

• You must be a Canadian citizen or legal resident at the time of application.
• You must have lived in Canada for at least 10 years after turning 18.
• Full OAS benefits require 40 years of residency after the age of 18.

Canada also has social security agreements with other countries. If you have lived or worked in another country, your residency in that country may count towards your Canadian benefits.

Example: If you lived in Canada for 15 years but also worked in the United States for 20 years, you may still qualify for a partial OAS payment under international agreements.

3. Income Thresholds for GIS

The Guaranteed Income Supplement (GIS) is available to low-income seniors.

• Single seniors must earn less than $20,952 annually to qualify.
• Married or common-law couples must have a combined income below $27,192.

Since GIS is based on income, seniors must file their income tax returns annually to ensure they receive the correct amount.

How to Apply for OAS and GIS Payments

1. Automatic Enrollment

Most seniors are automatically enrolled in OAS and GIS. Service Canada will send a notification letter before payments begin.

To check your enrollment status, log in to My Service Canada Account (MSCA) or contact Service Canada.

2. Manual Application Process

If you are not automatically enrolled, you need to apply manually.

Online Application

1. Visit My Service Canada Account (MSCA).
2. Complete the OAS application form.
3. Upload proof of residency and identity documents.

Paper Application

1. Download the OAS application form from the Service Canada website.
2. Complete the form and attach necessary documents.
3. Mail the application to the nearest Service Canada office.

In-Person Application

• Visit a Service Canada office with all necessary documents for in-person assistance.

Processing Time

• Online applications are processed in 4 to 8 weeks.
• Paper applications can take up to 120 days.

OAS and GIS Payment Date for January 2025

The OAS and GIS payments for January 2025 will be deposited on January 29, 2025.

• Payments will be sent via direct deposit or mailed cheques.
• If you haven’t received your payment by the end of January, contact Service Canada.

Tax Implications of OAS and GIS Payments

• OAS payments are taxable and must be included in your annual tax return.
• If your annual income exceeds $86,912 in 2024, you may be subject to the OAS Recovery Tax (clawback).
• The GIS payment is non-taxable, providing full financial relief to low-income seniors.

How to Minimize OAS Clawback

• Consider delaying OAS payments to increase the monthly benefit.
• Use a Tax-Free Savings Account (TFSA) instead of RRSP withdrawals to reduce taxable income.
• Speak with a financial advisor to develop a tax-efficient retirement plan.

How to Maximize Your OAS and GIS Benefits

Delay OAS Payments for Higher Monthly Income

• OAS payments increase by 0.6% per month if deferred beyond 65.
• Delaying until age 70 increases payments by 36%.

Use a TFSA to Reduce Taxable Income

• Withdrawals from TFSAs do not count as taxable income and do not affect GIS eligibility.

Claim Additional Tax Credits

• Age Amount Credit: For seniors over 65 with moderate income.
• Medical Expenses Credit: Helps offset costs not covered by health insurance.

Report Income Changes to Service Canada

• Notify Service Canada if your income changes to avoid GIS overpayment or underpayment.

Seek Professional Financial Advice

• A financial advisor can help you plan retirement income strategies to maximize OAS and GIS benefits.