Most older Canadians who qualify will see more money in their bank accounts as of Friday, when scheduled Canada Pension Plan (CPP) and Old Age Security (OAS) benefit payments start rolling out from the federal government.
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who → qualify → government
CPP and OAS payments are sent out every month to qualifying Canadians, and although both are designed to provide financial support for older Canadians, they differ in terms of how one qualifies and how much money can be received.
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money → send → terms
Payments will be sent electronically to bank accounts as soon as Friday for those who are signed up for direct deposit, while others could receive paper cheques, but may have to wait longer.
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others → send → cheques
CPP
CPP payments are going out to qualifying Canadians on Friday, and are jointly administered by the Canada Revenue Agency (CRA) and Employment and Social Development Canada (ESDC).
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payments → go → Agency
CPP is a mandatory deduction Canadian workers pay into for their retirements, and usually through regular payroll deductions by employers, while those who are self employed must ensure they are paying into CPP regularly.
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they → pay → CPP
The amount one could see on their regular CPP payments, including on Friday, varies based on average lifetime earnings, total contributions and the age they start claiming the benefits.
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they → see → benefits
To qualify for payments, a recipient must be at least 60 years old and have made at least one valid contribution to the program through their employment or self-employment.
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recipient → qualify → employment
The age one decides to start taking CPP payments determines how large their monthly payments will be.
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payments → decide → payments
The CRA says 65 years of age is the standard benchmark age it uses to estimate CPP payments, but those who qualify can start early at the age of 60 or as late as 70.
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who → say → 70
Starting earlier means the monthly payments will be smaller, while taking CPP from a later age will see larger monthly payments, but the maximum monthly amount is reached once a recipient turns 70.
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recipient → start → payments
For the 2026 calendar year, and based on the CRA’s benchmark age of 65 years old, the maximum benefit amount is $1,507.65 per month, while the average benefit could be $877 per month for new recipients.
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benefit → base → recipients
CPP payments are fully taxable as income, and must be declared when it comes to tax season.
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it → declare → season
However, the payment amounts do not change based on a person’s income level, unlike with OAS.
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amounts → change → OAS
OAS
OAS payments are also administered by ESDC, along with Service Canada, and although the CRA is not involved with administering the payouts, those OAS payments are still fully taxable as income.
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payments → administer → income
While CPP provides a retirement income for Canadians that paid into it while they were working, Canadians do not need to be employed or previously employed to qualify for OAS payments.
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Canadians → provide → payments
To qualify for OAS, recipients must be at least 65 years old, a Canadian citizen or legal resident at the time of approval, and they must have been a resident of Canada for at least 10 years since the age of 18.
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they → qualify → 18
Although OAS qualifications are not based on employment or contributions, a person’s income in the most recent tax year is one of the main factors that determine how much a recipient will get.
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recipient → base → much
Income, in this context, can be generated from employment, but also from EI benefits, rental property revenue, RRSP withdrawals, taxable interest, dividends and capital gains, among other examples.
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Income → generate → examples
Canadians between the ages of 65 and 74 could receive up to a maximum monthly payment of $751.97, while those 75 years and older could see OAS payments of up to $827.17.
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years → receive → 827.17
Those amounts could be reduced if an OAS recipient’s income exceeds certain thresholds, which is commonly known as OAS “clawbacks.”
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which → reduce → clawbacks
This means the maximum monthly OAS payment will most likely be seen by Canadians who receive a net income in the 2025 tax year that falls below the income threshold, which is $93,454.
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which → mean → threshold
The monthly payment will then be “clawed back” gradually for every dollar above that figure and up to the maximum income threshold.
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payment → claw → threshold
Those maximum income thresholds are $152,062 for recipients aged 65 to 74 years old, while those aged 75 and over have a maximum of $157,923.
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those → age → 157,923
The Aporia
