Increasing Old Age Security for Canadians 75 and Over
- Providing a one-time taxable payment of $500 in August 2021 to OAS pensioners who will be 75 or over as of June 2022. This will include seniors whose OAS pensions have been fully clawed back through the OAS Recovery Tax.
- Increasing OAS payments for pensioners 75 and over by 10 per cent on an ongoing basis as of July 2022.
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Providing a one-time taxable payment of $500 in August 2021 to OAS pensioners who will be 75 or over as of June 2022. This will include seniors whose OAS pensions have been fully clawed back through the OAS Recovery Tax.
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Increasing OAS payments for pensioners 75 and over by 10 per cent on an ongoing basis as of July 2022.
One-time payment of $500 in August 2021
The total gross cost was estimated by multiplying the number of estimated eligible seniors in June 2022 by the one-time payment amount. The number of eligible seniors in June 2022 was estimated by using PBO’s projection of individuals aged 75 or over in the second quarter of 2022 and multiplied by their estimated take-up rate.
10 per cent increase in OAS payments for pensioners 75 and over as of July 2022
Statistics Canada’s Social Policy Simulation Database/Model (SPSD/M, version 28.0)[^1] was used to estimate the impact of a 10 per cent increase in the basic OAS pension amount for the 2022 to 2025 period. For the 2026 period PBO projections were used.
For both measures, the effective tax rate for individuals aged 75 and over in SPSD/M was used to determine the personal income taxes that could be collected due to the measures.
SPSD/M is a simulated database and the resulting calculations may differ from actual payments. Using SPSD/M implicitly assumes that incomes for individuals 75 and over rebound to their pre-COVID level by June 2022.
- Estimates are presented on an accruals basis as would appear in the budget and public accounts.
- Positive numbers subtract from the budgetary balance, negative numbers contribute to the budget balance.