OAS Indexed for Fourth Quarter

Canadian residents age 65 and older will receipt the Old Age Security pension if they have made application to receive the benefit and their income is under prescribed thresholds. The maximum pension is $537.97 for each month in the fourth quarter in 2011: October, November and December (an increase of $4.27 per month from the previous quarter).

The OAS will be "clawed backî on the income tax return when an individual's net income is $110,123. This clawback is known as the OAS Recovery Tax. However, many don't realize that the recovery tax can be reduced by filing a Request to Reduce Old Age Security Recovery Tax at Source (Form T1213OAS, recently revised by CRA). This is possible if there are significant deductions from current year income, such as carrying charges, moving expenses or RRSP amounts, or significant non-refundable tax credits like the disability amount, medical expenses or charitable donations.