OAS Increase in August 2024: Are you a Canadian senior wondering if your Old Age Security (OAS) payments will increase this August 2024? The good news is that the OAS amount will indeed see an increase! The Canada Revenue Agency (CRA) has adjusted OAS payments in response to rising living costs, providing a welcome boost for retirees across the country.
What is Old Age Security (OAS)?
OAS is a government-provided pension for Canadian seniors aged 65 and older. Unlike the Canada Pension Plan (CPP), OAS doesn’t require contributions during your working years. Instead, it’s a monthly payment designed to help retirees manage living expenses in retirement.
OAS Increase in August 2024
The OAS payment for August 2024 is scheduled for August 28, 2024. This follows the regular monthly payment schedule established by the Canadian government. If you haven’t set up direct deposit, payments by cheque may arrive on or after this date.
Overview of OAS Increase and Payment Information
| Details | OAS 2024 |
|---|---|
| OAS Increase | 0.7% increase in payment |
| Payment Date | August 28, 2024 |
| Maximum OAS for Ages 65-74 | $718.33 per month |
| Maximum OAS for Ages 75 and over | $790.16 per month |
| Income Limit (Ages 65-74) | $142,609 |
| Income Limit (Ages 75 and over) | $148,179 |
| Official Website | Canada OAS |
Why Is There an OAS Increase in August 2024?
The increase is tied to inflation adjustments based on the Consumer Price Index (CPI). Each quarter, the CRA reviews and adjusts the OAS payments to reflect changes in the cost of living. For the July to September 2024 quarter, the OAS payment has been raised by 0.7%.
How Much Will You Receive?
Here’s a breakdown of the maximum monthly OAS amounts for 2024:
- Ages 65-74: Up to $718.33 per month
- Ages 75 and over: Up to $790.16 per month.
These amounts represent the maximum benefit, and your exact payment will depend on how long you have lived in Canada as an adult and your income level.
How Is the OAS Amount Calculated?
OAS payments are calculated based on how long you have resided in Canada after the age of 18. If you have lived in Canada for at least 40 years, you are eligible for the full benefit. If you’ve lived in Canada for less than 40 years, your payment is adjusted proportionally.
Other Benefits
In addition to the regular OAS payments, some seniors might qualify for additional support through:
- Guaranteed Income Supplement (GIS)
- Allowance (for those aged 60 to 64 whose spouse receives GIS)
- Allowance for the Survivor (for those aged 60 to 64 who are widowed).
Additional Information on Eligibility
It’s important to know that to qualify for OAS, you must meet certain residency requirements. Specifically:
- You must be a Canadian citizen or legal resident when your application is approved.
- You must have lived in Canada for at least 10 years after turning 18. If you reside outside of Canada, you may still qualify if you have lived in the country for at least 20 years after age 18.
If you haven’t lived in Canada long enough, you might still be eligible under an international social security agreement. This agreement allows for the totalizing of residence or contributions in other countries.
OAS Clawback
High-income earners should be aware of the OAS Clawback (also known as the OAS Recovery Tax). If your annual income exceeds the threshold (set at $86,912 for the period from July 2024 to June 2025), your OAS benefits may be reduced. The reduction rate is 15% of every dollar earned over this threshold.
For instance, if your income exceeds $142,609 (if you are 65-74) or $148,179 (if you are 75 and older), you won’t receive OAS benefits at all.
Tax Implications
OAS payments are considered taxable income. It’s important to plan ahead for the tax implications, especially if your income is higher than the OAS clawback threshold. This may mean setting aside a portion of your OAS payment for taxes at the end of the year.
Tips for Maximizing OAS Benefits
- Delay Your Payments: If you defer receiving OAS after turning 65, your payments will increase by 0.6% for each month you delay (up to a maximum of 36% at age 70).
- Keep Your Income Low: If possible, manage your taxable income to stay below the OAS clawback threshold to avoid any reductions in your payments.
- Combine with Other Benefits: If you are a low-income senior, you may qualify for the Guaranteed Income Supplement (GIS), which can significantly boost your total income in retirement.
How to Apply for OAS Increase in August 2024
Applying for OAS is a straightforward process:
- Check Eligibility: Make sure you meet the residency and age requirements.
- Apply Online or by Mail: Most Canadians are automatically enrolled, but if you aren’t, you can apply through your My Service Canada Account or by mail.
- Receive Confirmation: You will receive a letter confirming your enrollment and the start of your payments.
Managing Your OAS Online
You can manage your OAS payments and personal information through the My Service Canada Account (MSCA) portal. This allows you to:
- Update your personal details
- Set up or modify direct deposit
- View your payment history and upcoming payments
- Track your application status
FAQ
1. When will the OAS increase take effect?
- The OAS increase is effective for payments made in August 2024 and beyond.
2. Do I need to apply for the increase?
- No, the increase will be applied automatically to all eligible recipients.
3. Can I delay OAS payments?
- Yes, you can delay your OAS payments for up to five years after turning 65. For each month you delay, your payment increases by 0.6%. This means you could get up to 36% more per month if you start receiving OAS at age 70.
4. How do I check my payment status?
- You can check your OAS payment status through the My Service Canada Account (MSCA) portal.
