CRA Policy Changes For Seniors – How OAS, GIS, and Tax Credits Will Reshape Senior Benefits

The Canada Revenue Agency (CRA) oversees many of the most important programs that affect the financial lives of seniors. From Old Age Security (OAS) to the Guaranteed Income Supplement (GIS) and critical tax credits, even small shifts in CRA rules can have a major effect on retirees living on fixed incomes.

In 2025, the CRA has introduced significant changes to senior benefits, clawback thresholds, and tax credits. These updates are designed to keep payments aligned with inflation, offer more tax relief, and adjust rules for higher-income seniors. Here’s a detailed look at the three most important CRA changes in 2025 and why they matter for older Canadians.

Higher OAS and GIS Payments in 2025

The CRA has confirmed increases to OAS and GIS benefits, ensuring seniors’ purchasing power is protected against rising costs of food, housing, and healthcare.

• Old Age Security (OAS):
• Ages 65–74: $740.08 per month
• Ages 75+: $814.09 per month
• Guaranteed Income Supplement (GIS):
• Still income-tested but indexed to the Consumer Price Index (CPI), meaning low-income seniors will see higher payments that reflect inflation.

These increases are automatic. Seniors do not need to reapply, and payments will continue on the regular schedule.

OAS Clawback Thresholds Adjusted Upward

High-income retirees should pay attention to the OAS recovery tax, also known as the clawback. The CRA has raised the income thresholds for 2025, giving wealthier seniors more flexibility before losing benefits.

• OAS begins to be reduced once net income exceeds $93,454.
• Payments are fully clawed back at $151,775 for seniors aged 65–74.
• Seniors aged 75 and older face slightly higher thresholds due to their increased OAS benefit.

This change allows higher-income seniors to keep more of their OAS, improving after-tax retirement income for those with significant savings or pensions.

Expanded Tax Relief and Credits for Seniors

Beyond pensions, the CRA has also adjusted tax credits for seniors in 2025. These changes will help reduce taxable income and lower overall tax bills.

• Age Credit: The income threshold has been raised, meaning more middle-income seniors qualify.
• Pension Income Splitting: Couples can continue to split eligible pension income, reducing taxes for both partners.
• Disability Tax Credit (DTC): Adjustments ensure seniors with disabilities or medical conditions maintain access to enhanced tax relief.

Together, these measures ensure seniors can retain more of their income and face fewer financial burdens.

Why These CRA Changes Matter in 2025

Inflation continues to affect seniors disproportionately, as many rely on fixed pensions and limited savings. The CRA’s 2025 adjustments to benefits and credits provide meaningful support by:

• Protecting seniors’ monthly income through indexed OAS and GIS increases.
• Allowing wealthier seniors more time before facing OAS clawbacks.
• Offering tax relief that reduces the burden on middle- and low-income retirees.

For many older Canadians, these changes could mean the difference between financial strain and stability.

Key Takeaways for Seniors

• OAS and GIS benefits are higher in 2025, with maximum OAS rates now at $740.08 (ages 65–74) and $814.09 (ages 75+).
• The OAS clawback threshold has risen to $93,454, with complete elimination at $151,775 for most seniors.
• Tax credits expanded: Age Credit, Pension Income Splitting, and DTC updates benefit more seniors.
• No reapplication required: OAS and GIS increases are automatic.
• Seniors should review their 2025 tax filings to ensure they take advantage of all new relief measures.

FAQs – CRA Policy Changes for Seniors in 2025

Q1: How much will OAS payments increase in 2025?
Seniors aged 65–74 will receive up to $740.08 per month, while those aged 75 and older will receive $814.09 per month.

Q2: Has the GIS benefit also increased?
Yes. GIS remains income-tested but is indexed to inflation, meaning payments have risen to reflect the Consumer Price Index.

Q3: What is the new OAS clawback threshold?
OAS is reduced once income exceeds $93,454, and fully eliminated at $151,775 for those aged 65–74. Seniors 75+ have slightly higher thresholds.

Q4: What new tax credits are available for seniors in 2025?
The Age Credit threshold has been raised, pension income splitting continues, and the Disability Tax Credit (DTC) has been adjusted for broader accessibility.

Q5: Do seniors need to reapply for these new payments and credits?
No. OAS and GIS increases are automatic. For tax credits, seniors should ensure they file their 2025 tax return and claim all eligible credits.