Old Age Security for the first quarter of 2011 is paid at a maximum rate of $537.97, subject to a clawback that begins at $67,668 and ends at $110,123 when the clawback reduces OAS to zero. For single persons whose income, not including OAS, is less than $16,320, the Guaranteed Income Supplement is paid at a maximum rate $729.44, and for couples both over 65, and if income is less than $21,552, $483.68 per person per month.
Financial planning for retirement usually begins with the concept of preserving Old Age Security. the clawback, which reduces OAS payments at a rate of 15 cents for each dollar over $67,668, is effectively a tax on income received over that amount. therefore taxpayers who want to preserve their OAS benefits look to income splitting, often done by the simple expedient of shifting RRSP contributions to a spouse with a significantly lower income or shorter tenure in the labour force (which generally results in lower CPP entitlements).
| Type of benefit | Average amount (June 2011) | Maximum amount1 |
Income level cut-off 2a | Income level cut-off for top-ups 2b |
| Old Age Security pension3 | $498.22 | $537.97 | Not applicable | Not applicable |
| Guaranteed Income Supplement (GIS) | ||||
| Single | $453.38 | $729.44 | $16,320 | $4,448 |
| Spouse/common law partner of someone who: | ||||
| does not receive an OAS pension | $424.81 | $729.44 | $39,120 | $8,896 |
| receives an OAS pension | $281.67 | $483.68 | $21,552 | $7,456 |
| is an Allowance recipient | $375.27 | $483.68 | $39,1204 | $7,456 |
| Allowance | $387.13 | $1,021.65 | $30,192 | $7,456 |
| Allowance for the Survivor | $594.36 | $1,143.78 | $21,984 | $4,448 |
1 The maximum amount includes the new top-ups for the GIS and the Allowances effective July 1, 2011. More information is available on the Service Canada website at www.servicecanada.gc.ca/seniors
2a, 2b The income level cut-offs do not include the OAS pension or the first $3,500 of employment income.
3 Pensioners with an individual net income above $67,668 must repay part or all of the maximum Old Age Security pension amount. The repayment amounts are normally deducted from their monthly payments before they are issued. The full OAS pension is eliminated when a pensioner's net income is $110,123 or above
4 The Allowance stops being paid at $30,192 while the GIS stops being paid at $39,120.
The Canada Pension Plan (CPP) is changing. The Government of Canada is making changes to the Canada Pension Plan (CPP) intended to give Canadians more options so that they can make decisions that are right for them as they make the transition from work to retirement. These changes will gradually be introduce from 2011 to 2016, and will include:
The following table summarizes the impact of the CPP changes being phased in the years leading up to 2016:
| Age At Start | >CPP Adjustment | ||||||
| 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | |
| 60 | - 30.00% | - 30.00% | - 31.20% | - 32.40% | - 33.60% | - 34.80% | - 36.00% |
| 61 | - 24.00% | - 24.00% | - 24.96% | - 25.92% | - 26.88% | - 27.84% | - 28.80% |
| 62 | - 18.00% | - 18.00% | - 18.72% | - 19.44% | - 20.16% | - 20.88% | - 21.60% |
| 63 | - 12.00% | - 12.00% | - 12.48% | - 12.96% | - 13.44% | - 13.92% | - 14.40% |
| 64 | - 6.00% | - 6.00% | - 6.24% | - 6.48% | - 7.28% | - 6.96% | - 7.20% |
| 65 | 0% | 0% | 0% | 0% | 0% | 0% | 0% |
| 66 | 6.00% | 6.84% | 7.68% | 8.40% | 8.40% | 8.40% | 8.40% |
| 67 | 12.00% | 13.68% | 15.36% | 16.80% | 16.80% | 16.80% | 16.80% |
| 68 | 18.00% | 20.52% | 23.04% | 25.20% | 25.20% | 25.20% | 25.20% |
| 69 | 24.00% | 27.36% | 30.72% | 33.60% | 33.60% | 33.60% | 33.60% |
| 70 | 30.00% | 34.20% | 38.40% | 42.00% | 42.00% | 42.00% | 42.00% |
Note that the CPP operates throughout Canada, except in Quebec, where the Quebec Pension Plan (QPP) provides benefits. These changes do not apply to the QPP.
| Type of benefit | Average benefit (June 2011) |
Maximum amount (2011) |
|---|---|---|
| Retirement (at age 65) | $512.33 | $960.00 |
| Disability | $821.88 | $1,153.37 |
| Survivor - younger than 65 | $369.92 | $529.09 |
| Survivor - 65 and older | $301.64 | $576.00 |
| Children of disabled contributors | $218.50 | $218.50 |
| Children of deceased contributors | $218.50 | $218.50 |
| Deatd (maximum one-time payment) | $2,275.28 | $2,500.00 |
| Combined benefits | ||
| Survivor/retirement (retirement at 65) | $696.16 | $960.00 |
| Survivor/disability | $952.12 | $1,153.37 |