CPP Vs OAS – Benefits and Facts to Help You Choose from CPP and OAS

As Canadians get closer to retirement age, it’s a good idea to think about your expected income. People 60 years of age or older in Canada can apply for two well-liked government perks. These are Old Age Security and the Canada Pension Plan. However, what are these programs precisely, and how do CPP and OAS differ from one another? It’s possible that you are wondering if you qualify for both programs, or just one.

To find out more about each program and how they vary, keep reading below. To know Which One To Choose From CPP and OAS? you should not skip this article written by me. Here i will share the Differences between CPP and OAS and Facts and Benefits You Don’t Know about CPP and OAS?


The Canada Pension Plan (CPP) and Old Age Security (OAS) pension are two significant retirement income programs in Canada. Even while both programs give Canadians financial assistance throughout their retirement years, there are several key differences between them that should be noted. What distinguishes OAS from CPP, then? OAS and CPP are comparable in that they are both retirement and benefits programs for the elderly.

As Canadians mature, both increase their income. Furthermore, the government of Canada administers the OAS and CPP, two benefits programs but there are a few distinctions to take into account. CPP is a retirement benefit given to those who have worked all of their lives. OAS, however, is only a benefit available to senior Canadians. There is a variance in payment levels between CPP and OAS as well.

CPP Payment Increase 2024

CPP Benefits Increase 2024

CPP Payment 2024 Dates

Big Changes in CPP 2024

Differences between CPP and OAS

 Canada Pension PlanOld Age Security
FundingContributions to the CPP is mandatory for individuals and their workers. Contributory retirement pension is offeredOAS is not dependent on contributions from people; instead, it is supported by general government income. It is a retirement benefit that is non-contributory.
Contribution rateIf you are over 18, work outside of Quebec, and make more than CAD 3,500 annually, you must contribute to the CPP. With 5.95% employer and 5.95% employee pensionable earnings, the contribution rate is 11.90%, with a maximum total of CAD 7,508.90 (or CAD 3,754.45 each) in 2023.No personal investment is necessary.
Monthly amount receivedIt is dependent upon the extent and duration of your contributions to the CPP.
Depending on the length of time you have resided in Canada following your 18th birthday.
Supplementary benefitsAside from retirement benefits, the CPP offers survivor’s pension, children’s benefits, disability benefits, and post-retirement benefits.Included in OAS’s supplemental benefits are Allowance, Survivor Allowance, and Guaranteed Income Supplement.
Age of EligibilityEligibility for CPP benefits typically begins at age 65. If you choose to wait until you’re 70 years old to earn an enhanced CPP, you can start receiving a reduced CPP at 60.Eligibility for OAS requires you to be at least 65 years old. People who want a larger monthly pension can delay OAS for up to five years.
TaxesIt is a taxable income.OAS payments are taxable in Canada
Clawback OptionThe CPP pension is neither means- or income-tested, nor is it susceptible to a “Recovery Tax” or clawback.If your income surpasses a specific threshold, your OAS payments could be reclaimed. In 2023, your OAS pension will be “Clawed Back” in all or in part if your net income above CAD 79,845.
Benefits amounts for 2023For 2023, the highest monthly CPP payout is CAD 1,306.57. The benefit is CAD 717.15 on average per month.April through June of 2023 will see a maximum monthly OAS payment of CAD 698.60 for those 65 to 74 years old and CAD 768.46 for those 75 years of age and beyond.
Income splittingAs a tax-saving measure, spouses may choose to divide their CPP payout.Spouses are not permitted to share an OAS pension.
Other provisionsOther components of CPP include childrearing, general drop-out regulations, and credit sharing for separated or divorced spousesThe OAS pension has no additional features.
Inflation adjustmentsThe Consumer Price Index is used to determine CPP rate increases once a year (CPI).OAS benefits are modified every quarter in accordance with increases in the CPI.
Provincial differencesExcept for Quebec, CPP is for those who work in all provinces. The OAS is applicable to every province in Canada.
CPP Vs OAS - Benefits and Facts to Help You Choose from CPP and OAS

Which One To Choose From CPP and OAS?

Although you may have be aware of some of the federal retirement plans that are accessible to you, are you truly aware of Differences between CPP and OAS? It’s critical to comprehend Old Age Security (OAS) and the Canada Pension Plan (CPP) in order to ensure that you are adequately equipped to handle your retirement funds.

What you need know about each retirement plan is as follows. The two retiree programs are similar, yet they differ in their goals and effects on Canadians. Though it would be difficult to live exclusively on it, the concept is that our hardworking elderly may rely on a basic standard of life. The funds serve as an addition to investments, personal savings, and workplace pension plans.

OAS Payment Dates

OAS Starting Conditions

OAS Increase 2024

OAS Secrets

Are OAS and CPP enough for retirement?

Old Age Security and CPP alone rarely provide enough money for retirement. These benefits are intended to be used as a partial or supplemental source of income. However, a number of criteria, including your lifestyle and degree of savings, will determine how much money you need in retirement. The combination of your OAS and CPP may be sufficient to live comfortably if your cost of living is low.

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