GATINEAU, QC, Aug. 13, 2021 /CNW/ - Older seniors across Canada face higher financial pressures. As they age, seniors tend to have lower incomes and often face higher health-related expenses, all while they are more likely to be unable to work, have disabilities or be widowed.
Today, the Minister of Seniors, Deb Schulte, highlighted that older seniors who were eligible for the Old Age Security (OAS) pension in June 2021 and born on or before June 30, 1947, will receive a taxable, one-time payment of $500 next week, without needing to apply. Older seniors who live in Canada or receive their pension payment by direct deposit, will automatically receive the payment next week. Delays can be expected for cheques mailed outside of Canada.
This one-time payment will provide immediate support before the OAS pension is increased by 10% for seniors aged 75 and over beginning in July 2022. The 10% increase will provide an extra $766 to full pensioners over the first year and will be the first permanent increase to the OAS pension since 1973, other than adjustments due to inflation.
These measures are part of broader work to support seniors' financial security, including: restoring the age of eligibility for the OAS pension and the Guaranteed Income Supplement (GIS) to 65 from 67; strengthening the Canada Pension Plan for future retirees; increasing the GIS for single seniors; raising the GIS earnings exemption; and reducing income taxes for all Canadians.
Quote
"The Government of Canada is providing older seniors more help with the higher costs later in life. The one-time payment and the increase to the OAS pension for seniors aged 75 and up will strengthen seniors' financial security and help provide more support to all Canadians when they are planning their retirement."
– Minister of Seniors, Deb Schulte
Quick Facts
- While the one-time payment is taxable, it is exempt from the calculation of income for the Guaranteed Income Supplement (GIS), which means it will not affect the GIS calculation for future years.
- A separate tax slip will be issued for this payment and recipients will need to declare this payment when filing their Income Tax and Benefit Return.
- Eligible seniors will receive the one-time payment regardless of their income or whether they receive the GIS or not.
- Ninety-eight percent of OAS recipients are receiving their pension by direct deposit.
- This payment will benefit 3.3 million seniors who were eligible for the OAS pension in June 2021, 56% of whom are women.
- The Government of Canada has taken a number of actions to support seniors:
- The GIS was increased for nearly 900,000 low-income single seniors, lifting an estimated 57,000 seniors out of poverty.
- -Strengthening retirements of future Canadian seniors by restoring the age of eligibility for the OAS pension and the GIS to 65.
- The GIS earnings exemption was enhanced for working low-income seniors, to help them keep more of their benefits.
- Income taxes are being reduced through increases to the Basic Personal Amount. When the increases are fully implemented in 2023, 4.3 million seniors will benefit, including 465,000 whose federal income tax will be reduced to zero. Every year, singles will save close to $300 and couples will save nearly $600.
- The Canada Pension Plan's maximum yearly benefit was increased for future retirees by about 50%, meaningfully reducing the risk of not saving enough for retirement. The Quebec Pension Plan mirrored these improvements.
- One-time, tax-free payments were issued to help seniors with their extra costs during the pandemic, worth over $1,500 to a low-income couple. In April 2020, more than 4 million low- and middle-income seniors received a GST credit top-up—worth an average of $375 for individual seniors and $510 for senior couples. In July 2020, we provided a one-time tax-free payment of $300 to 6.7 million OAS pensioners and a further $200 to 2.2 million seniors eligible for the GIS.
Associated Links
One-time payment for older seniors - Canada.ca
Backgrounder: Increased costs for older seniors
Canada Pension Plan
Old Age Security
Guaranteed Income Supplement
Budget 2021
SOURCE Employment and Social Development Canada
For media enquiries, please contact: Daniel Pollak, Press Secretary, Office of the Minister of Seniors, 343-551-7558, [email protected]; Media Relations Office, Employment and Social Development Canada, 819-994-5559, [email protected]
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