The Guaranteed Income Supplement (GIS) is one of three benefits Canadians who qualify for Old Age Security (OAS) might be entitled to. The other two benefits are Allowance and Allowance for the Survivor, which I will review shortly. GIS provides a monthly non-taxable income to low-income individuals who already receive an OAS pension and live in Canada.
To qualify for GIS you must:
- be receiving OAS pension currently;
- and your annual income must be lower than the maximum annual threshold
Currently, the maximum annual income threshold is $17, 303.99 to qualify for GIS, which excludes OAS pension income being received. If your income is above that amount you do not qualify for GIS. For couples, your combined income cannot exceed $22, 847.99 to qualify for GIS benefit.
Similar to OAS pension, the GIS benefit is also undergoing some changes that will come into effect in the near future. The age eligibility for GIS will increase from age 65 to 67 with full implementation occurring in January 2029.
Individuals who qualify for GIS may also be eligible to receive an Allowance or an Allowance for the Survivor benefit. The Allowance for the Survivor benefit is paid to low-income individuals who’s spouse or partner is deceased. To qualify for an Allowance benefit you must meet the following conditions:
- You are aged 60 to 64 (includes the month your 6ths birthday
- you are aged 60 to 64 (includes the month of your 65th birthday);
- your spouse or common-law partner receives an Old Age Security pension (OAS) and is eligible for the Guaranteed Income Supplement (GIS);
- you are a Canadian citizen or a legal resident;
- you reside in Canada and have resided in Canada for at least 10 years since the age of 18; and
- you and your spouse or common-law partner’s annual combined income is less than the maximum allowable annual threshold.
As of 2016, a couple with a combined yearly income that’s more than $32, 015.99 , excluding OAS pension, would not qualify for an Allowance payment and neither will their spouse or common-law partner. If your spouse is deceased, your yearly income cannot exceed $23, 327.99 in order to qualify for the Allowance for the Survivor. The age eligibility for both the Allowance and the Allowance for the Survivor is set to increase from age 60 to 62 starting in April 2023.
Both the GIS and Allowance benefit are designed to provide an additional income stream, though limited, for low-income retirees.
While it’s important to be aware of the benefits these programs over, my hope is that most of you reading this will not qualify for either benefit. The important takeaway is to realize that government pension programs such as CPP, OAS, GIS and Allowance will not be enough to support you during your retirement on their own. Frankly speaking, a reliance on these programs will put you into poverty.
You have to take control of your retirement plan and avoid relying on a pension plan or government-sponsored program to fund your retirement.