When CPP and OAS Payments Increase Around Your Birthday

Happy 75th birthday, Luis. Below is a clear explanation of why your Old Age Security (OAS) pension did not change immediately on your birthday, what to expect next, and other important details about OAS and the Canada Pension Plan (CPP).

OAS increase at age 75

Since July 2022, the federal government provides a 10% permanent increase to OAS payments for pensioners aged 75 and older. That increase is applied automatically, but it takes effect the month after you turn 75. In your case, because your birthday was May 15, you should see the increased amount starting with the June payment.

This 10% boost is not a one-time bonus; it permanently raises the monthly OAS amount from that date forward. There is no separate application required for this increase.

For context, the maximum monthly OAS payment for the second quarter of 2025 for those who began receiving OAS at age 65 is $800.44. To receive the maximum full amount, net world income for the 2024 tax year generally must be below about $90,997. Actual entitlement and amounts can vary depending on your personal tax and residency history.

Applying for CPP and OAS — processing timelines

Service Canada provides timelines for processing OAS and CPP applications. If you apply online through a Service Canada account, processing is typically faster—often under two weeks. Paper applications mailed to Service Canada can take significantly longer, sometimes up to four months.

If you are approaching pension age, applying online will usually be the quickest route and helps ensure payments begin promptly the month after your eligibility date.

When does OAS start?

OAS can begin as early as age 65 and CPP as early as age 60. If you apply to begin OAS at age 65, the pension normally starts the month after your 65th birthday; CPP starts the month after your 60th birthday if applied for at the earliest date. There can be advantages and trade-offs to delaying either benefit — delaying tends to increase monthly payments but reduces the number of months you will receive the pension.

Retroactive OAS and CPP payments

If you apply for OAS after age 65 or for CPP after age 60, Service Canada can pay retroactive benefits. You may be eligible to receive up to 11 months of retroactive payments from the date your application was received. Retroactive amounts are paid as a lump sum and calculated based on the retroactive start date you request and qualify for.

Note that CPP retroactive payments cannot start earlier than the month following your 65th birthday in certain situations. Retroactive payments and deferral choices will affect both lump-sum amounts and ongoing monthly payments, so review the rules carefully before choosing to delay.

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Is OAS indexed to inflation?

Both OAS and CPP are adjusted for inflation. OAS is indexed quarterly (January, April, July, October) using Statistics Canada’s Consumer Price Index (CPI) All-Items Index. CPP is adjusted annually in January based on CPI. If the CPI does not increase between quarters, OAS will not be adjusted upward for that quarter; for example, there was no OAS increase from January 2025 to April 2025 because the CPI did not rise in that period.

It is important to note that indexation protects purchasing power but does not result in payments being lowered when the CPI falls.

OAS clawback (pension recovery tax)

If your net income is high, a recovery tax (commonly called the OAS clawback) may reduce or eliminate some of your OAS payments. The minimum threshold for recovery changes annually. Based on 2025 income rules, the basic recovery threshold begins around $93,454, but thresholds can be higher in particular cases—such as for those who delayed OAS to age 70—where the threshold can be as high as roughly $157,490.

Clawback calculations are based on your tax return for the previous year and are applied from July through June. Any tax withheld under the recovery rules is reported on your tax return and reconciled when your return is filed.

CPP post-retirement benefit (PRB)

If you start receiving CPP and continue to work and contribute to CPP before turning 70, you may earn a CPP post-retirement benefit. The PRB increases your CPP payments and is applied automatically; there is no separate application. PRB adjustments are typically reflected in your CPP pension the January following the year in which contributions were made.

Summary — your automatic 10% OAS increase

To answer your question directly: turning 75 triggers an automatic 10% permanent increase to OAS, but the increase takes effect the month after your 75th birthday. You should see the higher payment starting in June given a May 15 birthday. No application is required for that increase. If you have additional questions about timing, retroactive payments, clawbacks, or how deferring benefits might affect your long-term income, contact Service Canada or speak with a qualified financial advisor to review your personal circumstances.

Read more from Ask a Planner:

• How your net income gets calculated for tax and OAS
• What retirees need to know about tax brackets for 2025
• When and how to start drawing on retirement savings
• How to plan for taxes in retirement
• How much income you can earn while receiving OAS