Are You GIS-Eligible?

All seniors aged 65 and over are eligible for GIS if their income is low enough and they are also approved for Old Age Security.

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From the February/March 2012 issue of the magazine.

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All seniors aged 65 and over are eligible for GIS if their income is low enough and they are also approved for Old Age Security (which essentially requires them to be a long-time resident of Canada). You can get an application kit by calling Service Canada at 1-800-277-9914, or visiting servicecanada.gc.ca.

The maximum benefit is $8,788 for single seniors and $11,655 for senior couples. (Special rules apply if one spouse is a senior and the other is not.) As your income from other sources rises, your GIS entitlement falls: you lose roughly 50 cents of GIS for every $1 of other income. The income cutoff for GIS is $16,368 for singles and $21,648 for senior couples, which sounds so low that you may not even bother applying.

But wait: not all of your income is counted for GIS purposes. It turns out they don’t count your Old Age Security benefits: so if you add in full OAS, then a more realistic cutoff is $22,849 for singles and $34,610 for couples.

Now do you think you might be eligible? Hold on, because there are other adjustments you have to make to the government’s peculiar definition of income, some of which work in your favour, and some against:

  • First, some sources of income count dollar-for-dollar for GIS purposes with no adjustments: Canada Pension Plan benefits, employer pension income, interest, foreign dividends, and RRSP/RRIF withdrawals. Each dollar of income can cost you 50 cents of GIS.
  • For employment income, you don’t count the first $3,500 (so it doesn’t cost you any GIS). Above that threshold, you lose 50 cents of GIS for each dollar of employment income.
  • You only count half of your capital gains from investments, which means you lose only 25 cents of GIS for every $1 of capital gains.
  • You have to gross-up Canadian dividends by about 1.4 to calculate income for GIS purposes, so here you effectively lose about 70 cents on the dollar. (The grossed-up amounts are provided on your T3s and T5s, which you enter on your tax return.)

Now, if your head doesn’t hurt too much, add up all this income for GIS purposes. Go to the “Tables of Rates for Old Age Security, Guaranteed Income Supplement and the Allowances” on the servicecanada.gc.ca website to see the precise monthly GIS that applies to you.

Note that the government calculates your GIS benefits for the period July 1, 2012 to June 30, 2013 using your income in the reference year of 2011. When you first apply, they may adjust some types of income in your favour before determining your initial GIS benefit. For example, they might ignore your employment income in the reference year if you have since retired.

17 comments on “Are You GIS-Eligible?

  1. My CPP pension is $650 and I receive the full OAS for a total of some $1200. With the GIS, according to your article, I would actually get something around $22000 a year. However, according to the government website it works out to only somewhere around $18000. That's a rather big discrepancy. So how does it work and who is right? Thank you, sincerely, Mario Tubl

    Reply

    • Thanks, Mario, for your interest and questions. Based on your figures, and the tables on the government website, it looks like you would be entitled to GIS for a single person of about $4,280 a year. That would bring total income (CPP,OAS and GIS) to somewhere around $18,500, which is pretty much the figure you came up with from the government website.

      I don't know where in the article you got the idea that your total income including GIS would be $22,000. I did say you get less and less GIS as your other income rises and so if your non-GIS income was more than about $22,849 you wouldn't get any GIS at all (ie that's the income "cutoff").

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      • Very Informative David. Thank you for your article. My father is widowed and has worked in Construction (seasonal) for all his life. He does not have any pensions, savings, rsps etc. He is turning 65 in October and started collecting CPP at the age of 60 as he needed the extra income to look after his 35 year old handicapped son and pay down his home which he owns outright now. He receives $528.00/month in CPP currently and after talking to Service Canada he will receive an OAS of $546/mo and GIS of $428/month.

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    • am I entitled to receive the gis

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  2. This is very complicated! can someone help me understand it…

    Reply

    • Unfortunately GIS is really complicated. That's just the way the government set the program up. If you have any questions, you should call the Service Canada call centre at the number mentioned above. My experience is the call centre reps are patient, helpful and know the rules of the program thoroughly. They won't necessarily be able to advise you on the best financial strategy, but they can help you understand all the rules and the process to apply for GIS.

      Also it should be pointed out this article ran in the hardcopy MoneySense magazine together with a main article I wrote on GIS called "Finding Hidden Money". The two articles were designed to be read together, although the web folks have separated them. I suggest finding the other article and reading it as well if you want to get as complete a picture about GIS as possible.

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      • The link to "Finding Hidden Money" can be found within this article, on the far left under the section "We recommend." Happy reading!

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  3. Thank you for this article. Is there any active ! calculator for GIS (full pansion) I can use ?
    thank you Jey

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  4. My dad was in an accident in 2010 and was on WSIB until 2012 as because he took out early CPP – he was ineligble for CPP Disability – Ugh … he has had a hard time working ever since 2012 due to his injuries, and is still working with the Office of the worker advisor regarding the WSIB – but they only pay until he turns 65 years of age anyway. So my dad feels the only other option he has is to work through the pain for two years, defer the OAS and therefore not be eligible for the GIS either for two years and gain employment to put away some money for when he does retire in two years instead of in October of this year. Please let me know if you agree with this idea or If you could suggest any other options. Thank you.

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  5. My OAS starts this month. I received an application from the Gov't for GIS benefit however I know that I won't qualify at this time due to my spouse's income. Should I still complete the application? My understanding is that they continue to monitor year after year. Will they send me a new application each year?

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    • My mom is 81 and lives in Quebec, every year they adjust her GIC amount, we don’t understand how they calculate her rate,as her other incomes never change, are the rules different for quebec residents? It makes a real difference because when her GIC gets lowered the quebec government increases her drug co payments, so she gets hit on both ends.

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  6. What is the normal wait time to start receiving the supplement? I turned 65 in December 2012 and had the application submitted by the end of January 2013 and still haven't received anything. Got telephone verification of the amount i'll receive.

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  7. If husband and wife both receive OAP and GIS and only husband goes out to work, is that 50 cents taken off only from person working.

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  8. My husband and I do combined income when fileing our taxes and for the past two years we were getting the GIS but this year we were told we are no longer eligable.There is a difference this year of about 3000 dollars but after deducting oas our combined income amount is 34486 dollars..How much would we be over.

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  9. I am a 71 year old senior in BC who has applied for retroactive GIS for 2012 but has been denied GIS for this year because they used my 2011 income when I was still working and also took a one-time lump sum company pension plan payment. Perhaps I am wrong but I was under the impression that if:

    • You or your spouse or common-law partner has a lower annual income due to a retirement or a reduction of pension income (in such cases, we can calculate your GIS by estimating your income for the current year instead of using last year’s income).

    I believe this would then mean that because I only had CPP and OAS income in 2012 it would be based on this 2012 lower income instead but this did not happen so what can I do about this issue? I have 90 days to respond to GIS on this so would appreciate any help you can give me – thanks.

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  10. My CPP is $350.00 a month, and I’ll receive full OAP. I have a Lif and I receive about $3600 a year. I average about $600 a month (part-time job). My income for last year was around $13, 500. Never been married or partnered. Will I receive GIS. If so, about how much? Thank you.

    Reply

  11. Many immigrants to Canada, after they have resided in Canada for 10 years are eligible for the GIS., even though they have never worked in this country and therefore have not contributed to CPP. They live on interest from their investments. Is the money they have in the bank or banks included in the GIS calculations? In other words, is it possible for people to have a good bit of money but still collect GIS?

    Reply

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