Are you a senior citizen with a low retirement income living in Canada?
You might be eligible for a benefit that can supplement your retirement income.
The Guaranteed Income Supplement (GIS) Canada is an additional payment you can qualify for under the OAS Act.
I will discuss everything you need to know about the Guaranteed Income Supplement in Canada below.
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What is the Guaranteed Income Supplement in Canada?
GIS Canada is an additional benefit available to seniors with a low retirement income in Canada who either already receive or qualify for an OAS Canada pension. Having the support of GIS Canada can make a significant difference in your retirement income.
How Can You Qualify for GIS Payments?
You have to meet a few requirements to qualify for GIS Canada, including:
- Having an annual income lower than the maximum annual threshold, and
- Currently receiving an OAS pension.
- Must be a Canadian resident and live in the country for most of the year
The government uses your Federal Income Tax and Benefit return to review your income information. Depending on how much you (or you and your spouse combined) earn, your benefit will automatically renew if you qualify.
If you begin receiving GIS Canada, the amount you receive is adjusted automatically. The calculation depends on the latest tax return you file with the government.
Canadians who are non-sponsored immigrants in the country can qualify for GIS based on how long they have lived in Canada as an adult. Sponsored immigrants can also qualify if they meet certain requirements.
If you have been incarcerated for two or more years, your GIS eligibility is suspended.
Guaranteed Income Supplement Canada Amount
The amount of GIS Canada benefits you qualify for depends on your income level and marital status. The government considers your net income from the previous calendar year to determine the benefit amount you can receive. This amount excludes any amount you receive through OAS or GIS Canada.
Below are the maximum monthly GIS payment amounts for individuals in different situations.
For payments between July to September 2023:
| Marital Status | Maximum Monthly GIS Payment | Maximum Annual Income Threshold |
|---|---|---|
| Single, widowed, or divorced | $1,043.45 | Less than $21,168 (individual income) |
| Spouse/Common-law partner receives full OAS pension | $628.09 | Less than $27,984 (combined income) |
| Spouse/Common-law partner receives the Allowance | $628.09 | Less than $39,168 (combined income) |
| Spouse/Common-law partner does not receive OAS pension or allowance | $1,043.45 | Less than $50,736 (combined income) |
Service Canada generally considers only the previous year’s income to calculate GIS amounts.
However, if an OAS pensioner or their spouse has a reduction in income or retires, the government agency can use an income estimate for the current year to determine eligibility.
Service Canada reviews the estimate once you file your taxes. If the reported amount is different from the estimated income, it may adjust the GIS it pays you.
It means that you can receive additional GIS money or any excess GIS being deducted from future payments you receive.
GIS Canada Payment Dates in 2024
The GIS payment dates are the same as the OAS payment dates:
- January 27, 2023
- February 24, 2023
- March 29, 2023
- April 26, 2023
- May 29, 2023
- June 28, 2023
- July 27, 2023
- August 29, 2023
- September 27, 2023
- October 27, 2023
- November 28, 2023
- December 20, 2023
How is GIS Canada Calculated?
While you do not need to calculate the GIS Canada amount you receive yourself, it is helpful to know how Service Canada determines the amount it pays out. It uses your income for the last calendar year to calculate the amount. The GIS payment year spans from July to June, not January through December.
Example: The GIS payments you receive for July 2023 through June 2024 will be based on your 2022 income.
Service Canada reduces GIS income by 50 cents for each dollar of other income you receive, starting with the maximum payable amount. The exact GIS you receive depends on various factors, including whether your spouse/common-law partner receives OAS or Allowance and your filing status.
You need to report income and deductions to determine whether you qualify for GIS. The net annual income can include the following:
- Benefits from a Canada Pension Plan (CPP) or Quebec Pension Plan (QPP).
- Any additional pension income through private or foreign pensions.
- Income from Registered Retirement Savings Plans (RRSPs) that you cashed in the given year.
- Rental property income.
- Dividends and capital gains income.
- Investment income, including interest.
- Employment Insurance (EI) benefits.
- Net income from self-employment minus CPP or QPP self-contributions and EI premiums.
- Net income from employment minus $3,500 earnings exemption, CPP or QPP contributions, and EI premiums.
- RRSP deductions, union dues, employment expenses, and other deductions.
If you want to estimate your GIS income, you can review your last tax return and use it as a guideline. If you experience a loss of income in the current tax year, you can qualify to ask for a recalculation of your GIS income based on your current income. You can contact Service Canada to ask them for the form you can fill to request recalculating GIS based on current year income.
Applying for GIS Canada
In most cases, Service Canada automatically enrolls eligible Canadian seniors for an OAS pension. The automatic enrollment also extends to Canadian seniors eligible for GIS income.
If Service Canada automatically enrolls you for your OAS pension, they will enroll you for the GIS if you are eligible.
When Service Canada enrolls you for OAS and GIS, it sends you a notice through the mail one month after your 64th birthday.
It will notify you if you are eligible for automatic enrollment. For Canadians who do not receive the Service Canada letter but still qualify, there is an application you can fill out.
If Service Canada did not notify you about automatic enrollment, you could fill out the ISP-3550 (Application for the Old Age Security Pension and the Guaranteed Income Supplement) form.
Print out this form, fill it out, and mail it to Service Canada at the mailing address provided at the end of the application.
Seniors unable to apply due to medical conditions when they are eligible can fill out a Declaration of Incapacity form. Contact Service Canada if this is you. If you qualify for it, you can receive your pension with an earlier start date.
Information You Need to Gather to Apply for GIS
In case Service Canada does not automatically enroll you for GIS and you need to apply for the benefit, you will need to gather a few things, including:
- Your Social Insurance Number (SIN).
- Your spouse or common-law partner’s SIN and date of birth, if applicable.
- All the addresses where you have lived since turning 18.
- Your bank details if you want to sign up for direct deposits.
- The date when you would like your pension to begin.
You can fill out and submit a paper application. If you want, you can also apply online. For anybody applying for GIS online:
- You have to be a month older than your 64th birthday.
- You must not have applied for or be currently receiving an OAS pension.
- You need to be a Canadian resident currently living in Canada.
- You must not have any other legal representative like a power of attorney on your account.
To apply online, you need to create a My Service Canada Account (MSCA) and apply through it. You can register for an MSCA account here.
For Example: Jonathan is a widowed Canadian senior who is 67 years old. Service Canada automatically enrolled him for an OAS pension, and he has a net retirement income higher than the maximum income threshold to qualify for GIS Canada.
However, he lost some of the retirement income he was making through investment returns and has fallen below the maximum income threshold for 2021. His income this year will be $17,000 after the loss, and the maximum income threshold for GIS is $18,648 in 2021.
It means he can apply to Service Canada and request them to calculate his eligibility for GIS based on the current year’s estimated income. If Service Canada determines that he is eligible, Jonathan can receive GIS payment for widowed Canadian seniors for this period. The maximum monthly GIS he can receive is $916.38.
The exact monthly amount payable to you for GIS can change. Service Canada reviews the GIS benefit in January, April, July, and October to reflect the cost of living increases based on the Consumer Price Index.
Service Canada does not reduce the monthly payment if the cost of living goes down, but it increases the amount if the monthly costs go up.
GIS Clawback
The goal of Canada’s various retirement income support plans, like OAS and GIS, is to provide income from the government that helps you cover essential expenses.
The government has set various measures in place to ensure that no senior can abuse the benefit. It has set clawbacks in place to prevent any seniors from taking more than they qualify for through government benefits.
Low-income seniors already receiving GIS Canada might get a letter in the mail with either the notice that their benefit has been renewed or stopped. It could also state that you need to provide additional information to qualify for the benefit.
The clawbacks for both programs depend on the annual income for the given tax year. The OAS has the OAS Recovery Tax clawback that deducts 15% of taxable income for the excess amount in the annual income threshold.
The amount changes each year, and ideally, you should verify what amount applies as the maximum yearly income threshold each year.
Allowance
The Allowance is among the monthly supplementary benefits available to low-income individuals who are common-law partners or the spouse of someone receiving GIS Canada. The Allowance is a non-taxable benefit they can receive.
Who Qualifies for the Allowance Benefit?
To qualify for the Allowance Benefit:
- You need to be older than 60 and younger than 64 years old.
- Your spouse must be receiving the OAS and qualify for GIS Canada.
- You have to be a Canadian resident.
- Your combined income with your spouse/common-law partner must be below the maximum income threshold for the given year.
The maximum monthly payment that Service Canada pays as Allowance benefits is $1,305.71 for January to March 2023. You will stop receiving the Allowance benefits one month after you turn 65 years old. That is when you might qualify for OAS and/or GIS benefits yourself.
Applying for Allowance Benefit
You need to apply in writing if you want to receive the Allowance benefit. You can send your application to Service Canada from the month after your 59th birthday.
Allowance for the Survivor
Allowance for the Survivor is another supplementary benefit within the OAS program. The non-taxable benefit is available to low-income Canadian seniors between 60 and 64 years old whose spouse/common-law partner has passed away.
Who Qualifies for the Allowance for the Survivor?
To qualify for OAS survivor benefits:
- You must be older than 60 and younger than 64 years old.
- You must be a Canadian resident.
- Your annual income has to be lower than the maximum threshold for the given year.
- Your spouse/common-law partner has passed away, and you have not entered another common-law relationship or remarried.
The maximum monthly benefit under the Allowance for the Survivor is $1,556.51 from January to March 2023. The Allowance for the Survivor benefits stops a month after you turn 65 years old.
Applying for the Allowance for the Survivor Benefit
Applying for the Allowance for the Survivor Benefit requires filling out a written application and mailing it to Service Canada. You can send your application the month after you turn 59. Service Canada automatically determines your eligibility for this benefit and the amount you can receive based on your income tax returns.
Impact of Changes in Circ*mstances
Seniors often experience fluctuations in their financial situations due to various factors such as changes in employment status, unexpected medical expenses, alterations in investment returns, or adjustments in marital status.
These changes can lead to variations in their overall income, potentially influencing their eligibility for GIS benefits. For example, if a senior’s income falls below the established threshold due to a decrease in investment returns, they might become eligible for GIS payments, offering a vital financial lifeline.
What income is excluded from GIS calculation?
Income sources such as the Old Age Security (OAS) pension, the GIS itself, and the Allowance are not factored into the calculation. Also, non-taxable amounts from sources like the Canada Child Benefit, certain veterans’ benefits, and gifts are also excluded.
Conclusion
If you are already receiving an OAS pension, you should check to see if you qualify for the GIS payment. It is a benefit targeted to help low-income seniors earn a much better retirement income and bridge the income gap.
Service Canada automatically enrolls you for the OAS and GIS (if applicable). However, there is always a chance that you can qualify for GIS afterward due to a drop in your retirement income.
If you have any questions regarding the OAS benefits and GIS, you can contact Service Canada at 1-800-277-9914.
