Canada’s key senior support programs—Old Age Security (OAS), Guaranteed Income Supplement (GIS), and the Canada Pension Plan (CPP)—have been updated for May 2025 to provide better financial stability for seniors amid inflation and rising living expenses.
These adjustments ensure that retirees and low-income seniors can sustain a better quality of life.
Let’s break down the latest updates across all three programs, the payment increases, eligibility thresholds, and how they impact your financial planning.
Overview of OAS, GIS & CPP May 2025 Adjustments
To counter the cost of living and inflation, the federal government has made upward adjustments to all three major retirement programs.
These changes include monthly benefit increases, higher income thresholds, and enhanced contribution plans.
| Program | Adjustment Type | Updated Amount (May 2025) |
|---|---|---|
| CPP | Monthly Benefit Increase | Up to $1,433/month |
| OAS | Age-Based Benefit Increase | Up to $800.44/month for 75+ |
| GIS | Payment Boost for Low-Income Seniors | Up to $1,086.88/month |
CPP May 2025 Adjustments – Higher Payments & Replacement Rate
In 2025, CPP benefits increased by 2.6%, with the average monthly payout rising from $758.32 to $777.04. The maximum monthly benefit has now reached $1,433.
Additionally, the CPP enhancement—fully implemented in 2025—raises the income replacement rate from 25% to 33.33%.
That means someone who earned $60,000 annually before retirement can now receive $1,666/month, compared to just $1,250 before.
New Contribution Rates:
- Employee & Employer: 5.95% each
- Maximum earnings base: $68,500
- Second-tier contributions apply to earnings up to $73,200
This means higher CPP contributions during working years, but greater retirement security later.
OAS May 2025 Changes – Higher Monthly Payments & Clawback Threshold
Old Age Security has also received a 2% annual increase in monthly payouts:
- Ages 65–74: Now $727.67/month (up from $713.34)
- Ages 75+: Now $800.44/month (up from $784.67)
The OAS clawback threshold—where benefits begin to be reduced—was also raised from $86,912 to $90,997.
If a retiree earns $95,000, only the income exceeding the threshold ($4,003) will be subject to the 15% clawback, resulting in a $600.45 reduction in OAS payments.
GIS May 2025 Update – Bigger Payments & Broader Eligibility
The Guaranteed Income Supplement (GIS) saw a 1.3% increase in May 2025.
- Single seniors: Now receive up to $1,086.88/month (up from $1,072.58)
- Couples (each): Now receive $654.23/month (up from $644.16)
The income eligibility limit for GIS was also raised:
- Singles: Now allowed up to $20,904/year before payments are reduced
These adjustments help more low-income seniors qualify for additional monthly support, reducing financial pressure on essential needs like food, rent, and prescriptions.
What Retirees Should Do Now
The 2025 enhancements make this a crucial year for retirement planning. Consider the following steps:
- Review your retirement income mix (CPP, OAS, GIS, RRSPs, TFSA)
- Plan withdrawals to stay below clawback thresholds
- Explore income splitting if you’re partnered
- Adjust savings strategies to align with new CPP payouts
Combining government benefits with personal savings will deliver better long-term security.
The OAS, GIS & CPP May 2025 adjustments reflect Canada’s commitment to helping its ageing population cope with economic pressures.
With increased payouts, broadened eligibility, and enhanced retirement planning opportunities, seniors can now better manage their living expenses while preparing for a more financially secure future.
Staying informed and actively adjusting your strategy is key to making the most of these new benefits.
FAQs
How much is the maximum CPP payment in May 2025?
The maximum CPP payment in May 2025 is $1,433 per month, reflecting a 2.6% increase from the previous year.
What is the new OAS clawback threshold in 2025?
The OAS clawback now begins at $90,997/year, up from $86,912, helping retirees keep more of their benefits.
Are more seniors eligible for GIS in May 2025?
Yes. Singles earning up to $20,904/year may now qualify, thanks to revised income thresholds and increased payment amounts.