One of the most common questions for Canadians planning their retirement is, “Does Old Age Security (OAS) start at age 65 or 67?” The Old Age Security pension is a key benefit that provides financial support to eligible Canadian seniors, but there has been some confusion regarding the eligibility age. This article will clear up the details and provide updated information about when you can start receiving OAS payments in 2024.
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What is Old Age Security (OAS)?
Old Age Security (OAS) is a monthly pension available to most Canadians who are aged 65 or older. It is funded through general tax revenues, meaning you do not need to contribute directly to OAS in order to receive it. However, eligibility is based on several factors such as residency and income.
Does OAS Start at Age 65 or 67?
As of 2024, the OAS pension begins at age 65. There were proposals and discussions in previous years about increasing the eligibility age to 67, but those plans were canceled. The Government of Canada decided to keep the OAS eligibility age at 65.
Can You Defer OAS Payments?
Yes, you have the option to defer your OAS payments for up to five years, which means you could choose to start receiving the pension anytime between age 65 and 70. For every month you defer, your OAS pension increases by 0.6%. If you wait until age 70, your pension will be 36% higher than if you started at 65.
OAS Eligibility Criteria
To qualify for OAS at age 65, you must meet the following criteria:
- Age: You must be 65 years old or older.
- Residency: You must have lived in Canada for at least 10 years after turning 18 to qualify for partial OAS. For full OAS, you must have lived in Canada for at least 40 years after age 18.
- Citizenship/Legal Status: You must be a Canadian citizen or legal resident at the time of your application or when you left Canada.
How Much is the OAS Pension in 2024?
As of October 2024, the maximum monthly OAS payment is $1,385. The exact amount you receive depends on how long you’ve lived in Canada, your income level, and whether you choose to defer your payments.
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Clawback: OAS Pension Recovery Tax
If your income exceeds a certain threshold, part of your OAS pension may be subject to the OAS Clawback. In 2024, if your income is more than $86,912, you will have to repay some or all of your OAS benefits through the OAS Pension Recovery Tax.
In summary, Old Age Security (OAS) starts at age 65. While there was once a plan to raise the eligibility age to 67, this change was reversed. However, you do have the flexibility to defer your OAS pension up to age 70 to receive higher payments. For Canadians planning their retirement, understanding when and how to start OAS can be crucial for long-term financial stability.
Make sure you apply for OAS a few months before your 65th birthday to ensure you start receiving payments on time!