CPP/OAS/GIS: Government Pensions Explained!

[@InsignificantSpeckOfDust]

CPP and OAS should never be taxable....some of us have paid taxes for 40 years in Canada...it's totally unfair to keep taxing us during retirement....disgraceful.

[@adviice_ca]

For most people the basic exemption tax credit and age amount tax credit will reduce tax to $0 on approximately $25,000 per person of retirement income.

[@garth217]

Why?

[@gc583]

@@adviice_ca ooooo 25k /year wow .that is so much.rent cost 20k/year.That means i'll get eat twice a week after 45 years of working. Fantastic!!

[@howardabe9256]

CPP yes, OAS can go to people who have never worked so it's different

[@susanitasandia5065]

Here's a little known fact. When the government calculates eligibility for GIS after 65, $10,000 of earned income is exempt. I work part-time and this happened to me 2 years ago. My employment T4 was for $21,000, but they only used $11,000 in the calculation! Working part-time as a low income senior is worth it! Plus, the mental and emotional benefits of working are better than therapy!

[@adviice_ca]

That’s right! The first $5,000 of employment income is fully exempt and then next $10,000 (from $5,000 to $15,000) is partially exempt with a 50% exemption. So yes, with $21,000 of employment income you’d get a $10,000 exemption.

[@getkraken8064]

@@adviice_ca Please, can you tell me if you can make $5,000 in capital gains from trading stocks / crypto and it gets treated the same as income from a job????

[@adviice_ca]

No it’s not treated the same, capital gains are treated differently.

[@getkraken8064]

@@adviice_caThanks. Do you know any cra form or document that explains how they are treated re: GIS?

[@Cyclonut96]

@@getkraken8064 How about moving your stocks under RRSP stocks and then any gains are tax free money?

[@gordonloos1846]

People over 65 payed tax all their lives shouldn’t have to pay taxes

[@darrell3752]

Seniors have most of the money. Workers don't have much. So ... under your plan the seniors pay zero tax ( even though they have all the money ) and the working class gets to pay for everything. I bet society cannot get the senior's children and grandchildren to agree with your idea because they don't want the burden of paying for seniors, especially when seniors have all the wealth!

[@holgermessner851]

Listen. The tax is as sure as the Amen in church. The last time you pay pay taxes is at your funeral. Only after that you don’t get to pay taxes. But I’m not sure. Maybe they charge property taxes on the cemetery spot in the future too? 😂

[@TeresaS-q7x]

@@JohnSmith-uy2jg hahaha @ school you dropped out of..

[@gordonloos1846]

@@darrell3752 more senior living on the streets or in almost poverty besides they are the ones who payed tax’s all there lives they should be the ones getting it back not the people liberal government bringing into the country and lives on out dollar

[@gordonloos1846]

@@holgermessner851 you are wright but things need to change and it starts with the liberal party

[@johnmurray8454]

Gis benefits are income tested but people who are living in public housing do not need to include this subsidy (difference between subsidized rent and market rent) in contrast to working poor paying market rents.

[@GarryMurray-i1y]

This strategy only really works tax wise if you have little to no Rrsp or LIRA. Holding off on rrsp withdrawals can leave a huge tax bill later. If you are able to leave a legacy wouldn’t it be better to build your tfsa and not deplete it early? It doesn’t appear that GIS works for many people but it’s a great addition to those who weren’t fortunate enough to save enough.

[@FernValley5233]

Would love to have these calculations done for me as I’m low income. How do I go about this? Costs?

[@adviice_ca]

There are a couple of options. One is that you can start your retirement plan on adviice for $9/month and then engage a fee-only or advice-only planner through the platform. Most charge a “consult” fee that is under $1,000 if you already have all your info filled out. Or you can go to adviceonlyplanners.ca and engage an advice-only planner directly, this is anywhere from $2,000 to $4,000+. If you’re lower or moderate income the impact of GIS benefits can be substantial. At the very least start a retirement plan on your own and then get a “second opinion or consult” to check it over.

[@OLST5555]

Contact service Canada...they can send you a benefits statement for cpp, oas ,gist benefits. If you qualify they can help enroll you to start receiving them. A T4P statement will be sent annually so you can file your taxes each year..btw..filing your taxes every year also helps qualify you for any other tax credit benefits

[@djstonge]

Complicated ! They should teach this in schools

[@williaml3300]

I get cpp and oas and found out if I'm over 21,000 a year i can't get gis. My total for both cpp and oas is 21,000. The only way to live on 21,is to live out of your vehicle.

[@adviice_ca]

Thanks for the comment, there must be something else going on because OAS income is excluded from the GIS calculation and income thresholds.

[@b.masters5358]

What kind of vehicle do you have?

[@Dan-qd5gh]

@@williaml3300 And look at the USA Trump is canceling the tax on all seniors when he gets in. Why can't we have that here instead of seniors living on soup, hot dogs and kraft dinner.

[@paulcosgrove4219]

A new subscriber here :). I’m expecting a large WSBC (wcb) disability payment this year. Will it affect my GIS next year?

[@adviice_ca]

That’s a good question. Although it might be a non-taxable benefit it may actually show up on line 23600 but get deducted on line 25500 of your tax return. So it may be non-taxable but still cause GIS reductions. Best to call the CRA or speak with your accountant to clarify.

[@Faris-1974]

All you have to do is be able to outlive 70 + years . Hope and pray that you do . With 36 % inflation at this moment in 2024 . They say it's 2.5 % but I doubt it . 3 years ago I could feel shopping cart for snot 250 dollars now even 400 is not able .

[@fantasyguru26]

I don't think our inflation rate is that high but no doubt its well over the 'official' rate of 2%. If I had to guess its likely between 6-8% annually.

[@eileen.333]

How do you capture systematic price gouging by companies? Prices may go up bc of inflation but companies don’t drop prices while making record breaking profits. Grocery companies in the US admitted this. We had the price fixing of bread in Canada not long ago.

[@RORAtherose]

@@eileen.333not only do prices go up, but also the quantity/weight goes down which leads to paying more for less..

[@derekspence7241]

@@RORAtherosethat should be illegal

[@ilonaferrari1339]

Just a heads up, check your record. When I applied for my cpp I found they totally skipped one hear. Thank god I had all my documents from the day I started working. I sent copies of all my documents showing how much was contributed including the year they did not include. It was resolved but I’m sure if I had not been vigilant in checking how they came to their descion and did not have all my documents I would have not had that missing year included. So check everything and keep a file of all your documents.

[@adviice_ca]

Great suggestion! They do make mistakes.

[@cindyglass5827]

QUESTION : If a person was getting the OAS & GIS, and then they were left money in a Will when a family member died, or through the sale of the deceased house, how does that factor in ? Thank-you ! BTW, Great Info, Much Appreciated, I have subbed.

[@adviice_ca]

Good question! There is no inheritance tax in Canada, so the only impact would be the taxable income earned from the inheritance in the future. But if the inherited home becomes your primary residence then there is no taxable income. If an inheritance goes into a TFSA then there is no taxable income. So it just depends how the inheritance is used/invested.

[@cindyglass5827]

@@adviice_ca Thank-you very much for your reply ! I truly *Appreciate* it : ) I'll be choosing your company as I'll need more help when this takes place ... In the meantime, I'll search your site for a Video on a TFSA to learn what it is / more about it : ) HAGD, Most Sincerely, Cindy / [a possibly not too far off customer] whose more than willing to $ pay for your detailed & very knowledgeable advice-services : )

[@cindyglass5827]

@@adviice_ca Thank-you, I replied to you earlier today but I don't see my response : ( Maybe I hit the wrong button ... But, anyways, Thank-you for your info & detailed emailed ! : )

[@BernadetteMullin]

There is new money for retired seniors, what is the qualifications to receive it

[@adviice_ca]

Which “new money” are you referring to?

[@lincolnlawyer9704]

I paid the maximum into CPP for 41 years. For some reason I get 1342.14 at 65 and not 1364.58.

[@adviice_ca]

The $1,364.58 maximum includes a small portion of the new CPP Enhancement. Depending on when you stopped contributing you may not have made contributions to the new CPP Enhancement.

[@johnsmith100]

I recommend using Owen's help (not provided for free, of course) for planning your retirement. I communicated with him through email for some questions (for free), and though I eventually did my planning on my own, I can say he's knowledgeable and pleasant to communicate with.

[@adviice_ca]

Thank you!

[@Hazara26]

How about immigrants who are here and pay to CPP for less than 20 years will they get pension when they retire?

[@adviice_ca]

Yes if they made contributions. CPP is entirely based on the contributions made, which in turn is based on the employment income earned each year.

[@jessicayoung1190]

​@adviice_ca You would think that is the case. Government came out with this bs that low income seniors will have their CPP double.

[@justinbrowns1945]

Good video - Can you not just log into CRA and see what you would get for CPP? Why would there be a difference?

[@adviice_ca]

Good question, the CPP estimate from Service Canada assumes you keep working at your average rate of earnings right until the CPP benefit starts. It also doesn’t include future CPP enhancement. So if you’re retiring early, before age 65, if you plan to defer CPP, if you have more years before retirement and you’ll be contributing to CPP enhancement (CPP2) then your Service Canada estimate could be significantly higher or lower in reality. We’re talking about a few thousand per year in some cases, so it can have a big impact.

[@justinbrowns1945]

@@adviice_ca Thanks, so how do you get real numbers.

[@justinbrowns1945]

@@adviice_ca I should say I am 65

[@justinbrowns1945]

@@adviice_ca Thanks for the reply- So I just turned 65 two months ago. So is it what I would get when I log into service canada website? Or can it be less then they say?

[@timcorner2821]

I am 64 and my total income is 730.00 per month for cpp. When I turn 65 what can I expect to get for OAS and GIS combined?

[@adviice_ca]

Do you have any other income from RRSP/RRIF? Employment? Investment income?

[@timcorner2821]

@@adviice_ca no....was working part time until last March when I had a heart attack, then subsequent bypass surgery

[@adviice_ca]

Sorry to hear that, hope things are better now! Use this OAS/GIS calculator… estimateursv-oasestimator.service.canada.ca/en

[@timcorner2821]

@@adviice_ca Thanks....doing better, it's amazing how much better you feel with clean arteries......also thanks for the info

[@twstvan93]

Confused, why did you throw in all the other details and not just cover the three gov't pensions, CPP, OAS, and GIS, then move to all the other sorted details and strategies. A simple example for some one on a fix income of CPP, OAS is eligible for GIS would get what amount of GIS if CPP is max and OAS? This is what your caption supposedly implied what you were going to speak to.

[@adviice_ca]

Ah, it’s never quite so simple with GIS, every situation is unique. There are often other income sources like RRSP/RRIF withdrawals, employment income (which has exemptions and partial exemptions), non-reg income like interest, dividends, capital gains. CPP is typically not the maximum (rarely is, even for high income earners). Lots of factors impact GIS planning.

[@darrell3752]

Thanks

[@kaizokud42]

What happen to CPP (or QPP as I live in Quebec) if I am already receiving it but still working? Do I still contribute to the pension and if yes, how does it factor to the pension I received?

[@adviice_ca]

There is a Post Retirement Benefit (PRB) that gets added to your CPP benefit if you’re still working and contributing. After age 65 you have the option to stop contributing if you’ve started CPP and are still working.

[@AntoineScubaCorals]

how about if you retire out of country, What are you eligible for?

[@Cyclonut96]

Not OAS, CPP yes, not sure about GIS, probably not. I also worked in USA for 11 years, and am making more money from US SS than getting full Canadian CPP.

[@zojapopovic]

@@Cyclonut96This is not entirely true. If one was a resident for twenty years or more, OAS is still applicable.

[@Dan-qd5gh]

Why doesn't the Canadian government take the maximum out for CPP off of every Canadian and have one full amount to pay out which would be the maximum to every Canadian.

[@jaquigreenlees]

they take the minimum out so you have the funds in pocket to live. you can fill out a tax form and hand to your employer to have more taken off, doing so every year after tax season, to have more taxes taken off but if you don't then it's the minimum off.

[@DorothyPowder-vk6pf]

My cpp is 192 dallars I worked cince i was 18 now 68 why is this so tinny guess i will never be able to get away from poverty

[@Cyclonut96]

Did you pay into CPP?

[@caperboy1169]

All these years buying RRSP and some get a free pension

[@adviice_ca]

The “RRSP trap”. Stay away from RRSPs at lower and moderate income levels. They’re promoted by the banks and large investment firms but they’re not good for many people.

[@caperboy1169]

@ I’m getting a 28.85% return

[@Cyclonut96]

@@adviice_ca Right, invest into real estate, like the Indians are, any you will be rich and plentiful like they are...

[@paulinanelega]

Isn't OAS higher than what is showing in here, right now? And then there is also a 10% bump at 75 y.o.

[@adviice_ca]

Yup OAS goes up with inflation each quarter and yes a slight increase of +10% at age 75.

[@paulinanelega]

@@adviice_ca I'm still confused - table @ T 3:13 shows OAS being $8560/annum @ 65, but today's OAS is already higher than that.

[@adviice_ca]

Yes that’s correct, at the beginning of the year OAS was $8,560/yr but it increases each quarter so if you look today it will be higher. We only adjust the platform values annually given we do annual projections.

[@garth217]

I never understand why any one would delay CPP to 70. YES you get more money out of it, but it requires that you burn through YOUR MONEY in RRSPs first. I like a balanced approach. I just took CPP at 61. Half of the money is going directly into my TFSA and the other half into my high interest savings account. My TFSA is doing well currently and in the 4 years until I reach 65 I will maximize my TFSA. I'll collect CPP for 9 years before 70. The lower amount also keeps me out of OAS clawback

[@adviice_ca]

Lots of good reasons for either early or late CPP start ages, just depends on the situation.

[@mordet2]

The biggest value is the guaranteed, inflation protected, income. Moreover, you essentially lock in a 8.4% growth of your investment by not taking it at 65. Finally, the risk is that you'll get less money if you die early, however, most people don't really care, when they're 6ft under.

[@adviice_ca]

Some great reasons to delay CPP!

[@tedpark6814]

I think the reason is that you can received benefits which are indexed to inflation. If you melt down your RRSP, you don't actually have to spend it all, it can go into your TFSA or you can just invest it. So if I retire at 63, I melt down the RRSP for 7 years, then I'll get maximum CPP, which is indexed to inflation. As with so many things, your mileage may vary depending on your situation.

[@Carlg26]

unless you have been on wcb before you are forced to retire at 65 ... you get a lot less cpp.. then you do get GIS however its about 15 percent lower than what you were receiving from your wcb claim

[@gordonloos1846]

Don’t care how much a person made when they were working they payed in to the tax system even if they saved RSP every one should get the same amount of money people shouldn’t be punished for being smart enough to save and they were probably the ones who payed the most taxes

[@garth217]

Agreed. Sort of. What I don't like is OAS clawback. CPP is based on your wage ( skill set, education experience). OAS is a set amount based on age. But if you were successful in life and work, you get clawed back , but you paid much higher tax than those who didn't pay as much tax

[@F350-k8r]

If I get $1350.00 Oas and cpp, how much Gis should you get married?

[@adviice_ca]

It depends on so many factors. Your age and your partners age. The amount of taxable income you receive. The type of taxable income you receive.

[@JeffMacDonald-s6s]

How about the fact that the CPP is over 250 billion over what is needed to be fully funded for 75 years and they are not paying it out for those of us who payed into it, our generation of employers destroyed defined benefit pension plans

[@jacobuszwanenburg1629]

Later in retirement ?? When is that ? Waiting until 70 … isn’t that later enough already.

[@benvolman4976]

Work 40 years at max deduction. You're looking at 1300 and change per month. Also you're eligible for 800 and change OAS. About 2200 before tax each month in total at age 65. Now claim asylum and you're good for $224 per day per adult. Several years waiting list for your hearing. Make it make sense.

[@benvolman4976]

@OgnjenMali yes about 82 grand a year each adult over 18.

[@banker2679]

So person A saves for retirement and has a RRSP. Person B spends all their money travelling to Europe and saves nothing. Person A uses his savings. Person be gets 15,000 from the government. Make this make sense. Person A lives responsibly and gets penalized. Person B lives irresponsibly and gets rewarded. I didn’t do the calculation but the opportunity cost to person A is probably a million dollars that they could have spent on a luxurious lifestyle and then get 15,000 from the government.

[@rayeckert9425]

The person who had an RRSP has saved income tax based on contributions plus what ever growth the RRSP made. Be happy with what you have, don’t be bitter about what others did or have.

[@tomhamilton7726]

We must never forget that the goal of socialism is communism. And in Canada, we are on the fast track!

[@alutious]

Inaccurate thumbnail. An annual cpp of $16k will not get you a gis of $15k. As taxable income approaches 20k, gis is reduced. Income of 10k will generate about 8k, 19k income will generate 1-2k of gis. Please fix the thumbnail, otherwise its clickbait.

[@carltwigg3946]

OAS costs the CDN taxpayers 68$ billion a year and by taxpayer I’m referring to those individuals who actually pax federal/provincial taxes. It should be phased completely out and CPP income payment levels vastly increased. US Social Security income levels max out at over 165k/yr, CPP is set at under 70k/yr. It’s ridiculous the differences. A person should not just get ‘free money’ based on the fact that they lived 40yrs in Canada and please don’t tell me that a person has paid taxes and ‘deserves’ OAS. Less than 40% of the working population actually pays anything in income taxes.

[@Sickandfedup]

Far better to be an asylum seeker. Pays $234 per day. Ffs

[@ramesh751]

Even the poor countries in the world have better pension schemes for their citizens

[@gordonloos1846]

Don’t care how much a person made when they were working they payed in to the tax system even if they saved RSP every one should get the same amount of money people shouldn’t be punished for being smart enough to save and they were probably the ones who payed the most taxes

[@garth217]

Exactly