The Guaranteed Income Supplement

The GIS is paid monthly, tax-free, to anyone receiving OAS whose income is low enough. It is the reason a modest-income retiree is usually better off in a TFSA than an RRSP: every dollar drawn from an RRSP or RRIF is income for the GIS test and costs at least 50 cents of supplement before any income tax; a dollar from a TFSA costs nothing.

The formula

Single pensioner, on the previous calendar year's income with OAS itself excluded:

base   = max(0, 11,390.04 − 0.50 × income)
top-up = max(0,  2,088.00 − 0.25 × max(0, income − 2,000))
GIS    = base + top-up            (maximum 13,478.04 a year, July–September 2026)

So the taper is 50% below $2,000 of income, 75% from there until the top-up is gone at $10,352, then 50% again until nothing is left at about $22,800. The first $5,000 of employment or self-employment earnings is ignored, and half of the next $10,000.

A couple where both receive OAS is tested on combined income, at a lower maximum for each ($8,113.08), with the top-up falling by one dollar per eight of combined income over $4,000 and the base by one per four; nil at about $30,096.

What the engine does

• Pays it monthly to each person with an OAS stream in pay, on the prior year's income (the first plan year uses that year's own run-rate). Amounts and thresholds index at the plan's inflation rate from the July–September 2026 figures.
• Counts employment (after the exemption), CPP and other taxable benefits, RRSP withdrawals and RRIF minimums as income. OAS and TFSA withdrawals are excluded.
• Uses the single table for a one-person plan and the couple-both-on-OAS table when both partners have OAS streams.

What it deliberately does not

• A couple with only one OAS stream gets no GIS, and the plan says so: those rows carry extra exemptions and the Allowance, which are not modelled.
• The statutory rounding of income to even dollars, the July–June payment year, and the option to be assessed on estimated current-year income after retiring mid-year.
• Provincial top-ups such as Ontario's GAINS.