A Reference Guide - Old Age Security and Canada Pension Plan
Old Age Security Program
The Benefits
Old Age Security Pension
The OAS pension is a taxable monthly benefit available to most people 65 or older who meet the residence requirements. Eligible applicants can receive the OAS pension even if they are still working or if they have never worked, but they must apply for it. Pensioners whose net income, including the OAS pension, is above a certain amount ($62,144 in 2006) are required to reimburse part of their pension amount.
To qualify: To qualify for an OAS pension in Canada, applicants must be 65 years of age or older and must be Canadian citizens or legal residents of Canada at the time the pension is approved. They must have resided in Canada for at least 10 years after the age of 18. Periods of residence and/or contributions in a country with which Canada has a social security agreement may be used to help meet the residence requirement for eligibility. (See International social security agreements.)
Amount of benefit: The amount of the OAS pension is determined by how long a person has resided in Canada, according to specific rules.
- A person who has resided in Canada for at least 40 years after reaching the age of 18 may qualify for a full OAS pension.
- A person who has not resided in Canada for 40 years after the age of 18 may still qualify for a full pension if, on July 1, 1977, he or she was 25 years of age or over, and
- resided in Canada on that date, or
- had resided in Canada after the age of 18 and before that date, or
- possessed a valid immigration visa on that date.
To qualify, a person must normally have resided in Canada for 10 years immediately before approval of his or her application. However, under certain circumstances, an exception can be made. A person who, after the age of 18, lived in Canada for at least three years for each year of absence during that 10-year period, and also resided in Canada for at least one year immediately before the application is approved, will qualify for a full OAS pension.
Example: From age 55 to 65, Marie lived outside Canada for two years. She lived in Canada for 30 years between the ages of 18 and 55. Marie has thus lived three years in Canada for each of the two years she was absent from Canada (during the 10-year period). Since Marie also lived in Canada for a year before her application was approved, she qualifies for a full OAS pension.
Absence from Canada: People working outside Canada for Canadian employers, or for international organizations, may have their time working abroad counted as residence in Canada. This may also apply to their spouses/common-law partners and dependants.
Partial pensions: A person who cannot meet the requirements for the full OAS pension may qualify for a partial pension if he or she has resided in Canada for at least 10 years after the age of 18. A partial pension is paid at the rate of 1/40th of the full monthly pension for each full year of residence in Canada after the applicant's 18th birthday.
Payment outside Canada: To receive the pension when no longer residing in Canada, the applicant must have been a Canadian citizen or a legal resident of Canada when he or she left.
Once a full or partial OAS pension has been approved, it may be paid indefinitely outside Canada if the pensioner has resided in Canada for at least 20 years after reaching the age of 18. A person who has not resided in Canada for 20 years but who has resided or worked in a country that has a social security agreement with Canada may meet the 20-year residence requirement under the provisions of that agreement (see See International social security agreements.)
If the person does not meet the 20-year residence requirement, payment may be made only for the month when he or she leaves Canada, and the following six months. The pension may be reinstated if the person returns to reside in Canada.
Retroactive payments: People who apply for an OAS pension after the age of 65 can receive a retroactive payment back to their 65th birthday or to a maximum of 11 months, whichever is shorter. The period of retroactivity is calculated from the month the application is received. (They would at the same time receive payment for the month in which the application was received.)
