Canada’s Canada Pension Plan (CPP) and Old Age Security (OAS) programs, administered by the Canada Revenue Agency (CRA), have announced important updates for 2024 to better support seniors amid rising costs. These updates reflect the Canadian government’s commitment to improving income security for retirees, with new adjustments taking effect in January 2024.
Here’s a fact-checked summary of the recent changes to CPP and OAS, including eligibility, updated benefits, and how to apply.
Key Updates for CPP and OAS in 2024
1. CPP Updates
CPP is a retirement income program funded by contributions from Canadian workers and employers. The following are the main updates for 2024:
- Contribution Rate Increase: The CPP contribution rate has risen to 5.95% for both employees and employers (up from 4.95%). Self-employed individuals are required to contribute 11.9%, covering both shares.
- Earnings Ceiling Adjustment: The maximum pensionable earnings ceiling will be raised by 2025, allowing for higher contributions and potentially higher payouts.
- Benefit Increase: The monthly CPP payment for 2024 is set at $1,364 for those who qualify for the maximum benefit. This amount is based on an individual’s work and contribution history.
- Enhanced Disability and Post-Retirement Benefits: CPP Disability benefits have been increased to offer greater support, and new post-retirement benefits have been introduced, allowing retirees who continue working to make additional contributions to increase their benefits.
2. OAS Updates
OAS provides seniors aged 65 and older with a monthly income based on residency, not work contributions. Here’s what’s new for 2024:
- Payment Increase: OAS benefits will see a 1.3% increase for the October to December 2024 quarter. This adjustment is tied to the Consumer Price Index (CPI) and aims to help seniors cope with inflation.
- Clawback Limit Increase: The OAS clawback threshold has been raised to CAD 90,997. Seniors with income above this threshold will see their OAS benefits reduced at a rate of 15% for every dollar exceeding the limit.
- Deferral Option: Seniors can now choose to defer their OAS benefits for up to five years beyond the traditional retirement age, allowing for increased payments by 0.6% per month of deferral, up to a maximum increase of 36% at age 70.
CPP and OAS Payment Schedule for 2024
Monthly CPP and OAS payments follow a set schedule, helping seniors plan their finances. The remaining 2024 payment dates are as follows:
| Month | Payment Date |
|---|---|
| September | September 25, 2024 |
| October | October 29, 2024 |
| November | November 27, 2024 |
| December | December 20, 2024 |
Eligibility Requirements for CPP and OAS in 2024
Eligibility requirements vary for each program:
CPP Eligibility
- Age: Minimum of 60 years to start receiving benefits, though early benefits will be reduced, while delayed benefits (after age 65) increase by 0.7% for each month deferred, up to age 70.
- Work Contributions: Applicants must have made valid contributions through employment in Canada or self-employment earnings.
- Residency: Applicants must reside in Canada or be eligible under specific international social security agreements if they’ve worked abroad.
OAS Eligibility
- Age: Minimum of 65 years to qualify.
- Residency: A minimum of 10 years of residency in Canada after the age of 18 is required. For those living outside Canada, a minimum of 20 years of Canadian residency is required.
- Income Limits for Full Benefits: For low-income seniors, there may be eligibility for additional benefits, such as the Guaranteed Income Supplement (GIS).
How to Apply for the CPP and OAS Pension Increase
Eligible seniors can apply online, by mail, or in person. Here’s a step-by-step guide:
- Online Application:
- Log in to your My Service Canada Account (MSCA).
- Access the CPP or OAS application form and complete the necessary fields.
- In-Person Application:
- Pick up an application form from a Service Canada office or download it from their official website.
- By Mail:
- Fill out the form completely and send it to the address provided on the Service Canada website.
Applying at least six months before you want to start receiving benefits is advisable. Once submitted, applicants should receive a confirmation and, if approved, will see their enhanced benefits on the next scheduled payment date.
The CPP and OAS increases for 2024 provide valuable support to help seniors manage their retirement expenses amidst rising costs. These enhancements reflect the Canadian government’s commitment to maintaining income stability for retired citizens.
To ensure accuracy, applicants should verify details on the official Government of Canada website and consult with financial advisors for personalized advice.
