Old Age Security (OAS): How Does it Work?

Old Age Security (OAS)

Old Age Security (OAS) pension is payable to all Canadians or legal residents 65 years or older. The program came into existence in 1952 and is a social assistance program funded by the Government of Canada’s general federal tax revenues and is a taxable income benefit.

Who qualifies for Old Age Security?

The eligibility for Old Age Security is based on how long you’ve lived in Canada. To be eligible for OAS, you must be 65 years of age or older while meeting one of the following requirements;

  • Must be a Canadian citizen or legal resident of Canada preceding your application approval
  • If you no longer reside in Canada, you must have been a Canadian citizen or legal resident of Canada on the day before you stopped living in Canada.

To receive an OAS pension in Canada, you must have resided in Canada for at least ten years since turning 18.

How to Apply for Old Age Security (OAS) Benefit?

At the time of writing this post (2022), you do not need to submit an application to start receiving your Old Age Security pension benefit. You are automatically enrolled into the Old Age Security pension a month after turning 64. If you do not qualify automatically, you will receive a letter informing you of your ineligibility, detailing the reason for not qualifying. If you need to manually apply for Old Age Security, you can do so through your My Service Canada Account.

What is Required for Full Old Age Security Pension?

To be eligible for a full Old Age Security pension, you must have lived in Canada for 40 years after reaching 18 years of age. You may also qualify for a full OAS pension if you have not lived in Canada for 40 years but were 25 years of age or older on July 1, 1977, and meet one of three conditions below;

  • You must have lived in Canada on July 1, 1977
  • Had a valid immigration visa on July 1, 1997
  • You had lived in Canada prior to July 1, 1977, after you reached the age of 18

Suppose you do not meet the criteria above for a full old age security pension. In that case, you may qualify for a partial old age security pension at a reduced rate of 1/40 of the full old age security pension for each year you lived in Canada after turning 18. For example, suppose you only lived in Canada for 20 years after turning 18. You would be entitled to 50% or 20/40 of the full old age security pension benefit available.

Does Work Outside Canada count towards the Old Age Security Pension?

If you are a Canadian who works for a Canadian employer, you may be able to count your time aboard towards your residence requirement for OAS. To do so, you must meet the following criteria;

  • Returned to Canada within six months of employment ending
  • You maintained a residence in Canada while working outside of Canada and turned 65 years old while still employed with your employer

In addition to those requirements, you will need to provide proof of employment from your employer and evidence that you’ve physically returned to Canada. Proof of physically returning to Canada is not required if you turn 65 while still employed outside Canada.

How Much will Old Age Security Pay Me?

If you qualify for full Old Age Pension as of 2022, the maximum monthly payment is $666.83 for individuals aged 65-74 with an annual income of less than $134,253. Individuals aged 75 and over can qualify for a monthly maximum OAS payment of $733.51 with an income less than $136,920. Old Age Security pension payments are updated to reflect quarterly CPI changes, but payments are not reduced if CPI is lower.

There have been some recent changes to the Old Age Security program, which will result in a 10% permanent payments increase for individuals who are 75 years or older as of June 22. These payments will commence as of July 22. The increase will not impact the amount received currently under the Guaranteed Income Supplement (GIS).

OAS recipients can also choose to delay their OAS benefit up to 60 months, resulting in a 0.6% increase in payment for each month it’s delayed. However, no additional benefit is received after 70. Therefore, there’s little benefit to waiting to receive OAS benefits after age 70.

Old Age Security Payment Date for 2022

Old Age Security payments are normally paid at the end of each month. The chart below shows the specific Old Age Security payment date for 2022.

Month OAS Payment Date
May May 27, 2022
June June 28, 2022
July July 27, 2022
August August 29, 2022
September September 27, 2022
October October 27, 2022
November November 28, 2022
December December 21, 2022

Can You Receive Your Old Age Security Outside Canada?

You may receive your OAS pension outside of Canada once approved (full or partial) if you’ve lived in Canada for at least 20 years after turning 18. Individuals who choose to live or work in a country with a social security agreement with Canada can receive their OAS payments indefinitely if they meet the 20-year residence requirement.

If you do not meet the 20-year residence requirement, you can still receive your OAS pension, but only for six months plus the month, you leave Canada.

How does OAS Pension Clawback work?

Old Age Security is a social program benefit funded from the government’s general tax revenue; you are not required to contribute to the program; your qualification is based on residence. Old age security clawback, more accurately referred to as old age security pension recovery tax, is effectively the government recovering the benefits for individuals whose income exceeds the program’s income test.

You may have to repay part or your entire OAS pension if;

  • Your annual income exceeds the minimum yearly income recovery threshold
  • You reside in a country where the non-resident tax on Canadians’ pensions is 25% or more

As of 2022, the minimum income recovery threshold is $81,761, resulting in a partial clawback of 15% above the minimum income level. For example, your total income for 2022 is expected to be $91,000. The total pension clawback you would have to pay back will be $1,385.85.



The maximum Old Age Security income clawback for 2022 is $134,253 for individuals aged 65-74 and $136,920 for individuals aged 75 and older. Any above income this maximum will result in OAS benefits being fully clawed back. Clawback income limits are based on each taxpayer’s situation and not the total household income, nor does it combine your spouse or common-law’s income in determining your clawback.

The Old Age Security pension is one of the government pension benefits that you may be able to count on as a source of retirement income. The OAS pension does not have to contribution requirement as its qualification is based on residence. However, due to it being a government-sponsored benefit, there is an income test requirement, and if your income exceeds the program’s income test, you will not qualify for the benefit. As you approach retirement, it’s important to know what you expect your retirement income to be to see if Old Age Security pension is something you can expect to receive as a source of retirement income.

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