Are you a retired member? Find everything you need to know about OMERS pensions, taxes and inflation protection below.
Pension payments by direct deposit arrive on the first banking day of the month. Most major Canadian banks will have the payment in your account the same day; credit unions and non-traditional banks may take an extra day or two. Pension cheques are mailed to arrive at the beginning of the month.
January 2 | July 2 |
February 1 | August 1 |
March 1 | September 3 |
April 2 | October 1 |
May 1 | November 1 |
June 3 | December 2 |
We pay OMERS pensions in equal monthly instalments at the beginning of the month. Most OMERS pension payments are made by direct deposit. Payments are also made by cheque.
Pension payments by direct deposit are automatically deposited into your account on the first banking day of the month. (Note: this isn't always the first day of the month; it could be the first day banks are open after a weekend or holiday.)
Direct deposit is safe and secure: you don't have to wait for a cheque to arrive by mail, and you don't have to be home to get your payment.
You can easily change your address information online with myOMERS or by calling OMERS.
We can make direct deposit payments to most banks and financial institutions in Canada, the U.S. and the U.K. If you receive your pension in Canadian dollars, your 12 monthly pension payments in any year will be the same. Pensions paid in U.S. dollars or U.K pounds may fluctuate, depending on your bank's exchange rate. If your payment is not in your account by the first banking day of the month, contact your bank or OMERS Member Experience.
To have your pension directly deposited into your bank account every month:
Submit a Changing information (retired member or survivor) form and complete the banking information section, or include a cheque marked “void” with the form.
For a bank account in the U.S. submit a USA direct deposit request form.
For a bank account in the U.K. submit a U.K. direct deposit request form.
For your protection, OMERS cannot make changes to your banking information by email.
If you are a registered myOMERS user, you can change your banking information online.
Submit a Changing information (retired member or survivor) form.
Send a signed letter to OMERS that includes your full name (printed); your OMERS membership number (or social insurance number); the effective date of the change; the new information (bank, branch, and account number), or a void cheque from the new account.
Tip: Keep your old account open until the deposit actually goes into your new account, in case we don't receive your new information in time for your next monthly payment.
If you receive your monthly pension payments by cheque, you can expect to receive your cheque at the beginning of each month.
If your cheque hasn't arrived within five business days, please contact OMERS Member Experience. If you live outside Ontario, in the U.S., or overseas, please allow 10 days.
To change your address or other information:
Submit a Changing information (retired member or survivor) form; or
Send a signed letter to OMERS that includes your full name (printed), current address and phone number; your OMERS membership number or reference number (or social insurance number); the effective date of the change; and the new address information.
Information about income tax and your OMERS pension is valuable.
Be sure to make use of all available tax credits and deductions to help maximize your money. For example:
Once you turn 65, you may be eligible for the federal age tax credit.
As a retiree, you may qualify for HST credits.
When you withdraw income from a RRIF or other plan, keep in mind that this income could impact your eligibility for government programs such as age credits, HST credits, the Guaranteed Income Supplement (GIS) and more. Always check first.
The tax withheld from your OMERS pension is based on your monthly pension payments, your federal and provincial income tax forms (TD1) or country of residence information, and any additional tax you've asked us to withhold.
To update your federal and provincial income tax information, complete and send OMERS the TD1 forms.
You can view and print your tax slip directly from your myOMERS account, and OMERS will also send you a tax slip for your OMERS pension (retirement, survivor or disability pension), by the end of February each year. The tax slip is your official proof of income for tax purposes. It shows the total amount of pension paid to you during the previous calendar year and the total tax deducted.
Tax slips are mailed to your principal (home) address.
T4A: If you reside in Canada, we will mail a T4A slip to your home address.
NR4: If you reside outside Canada, we will mail an NR4 slip to your home address.
If you haven't received your tax slip by early March, contact OMERS Member Experience; we will confirm your mailing address and send you another slip.
As a registered myOMERS user, you can reprint your T4A tax slips online.
If part of your pension is paid from the Retirement Compensation Arrangement (RCA), we will send you separate tax slips for the portion paid from the OMERS Primary Plan and for the portion paid from the RCA.
If OMERS pays a portion of your pension directly to your former spouse, we will send the former spouse a tax slip for the amount paid. That amount will not appear on your tax slip, as it's a reduction in your OMERS pension income.
If you have arranged to pay your former spouse yourself (without OMERS involvement), your full OMERS pension income will appear on your tax slip.
Income tax is deducted from your OMERS pension as required by the CRA. You can also arrange to have OMERS deduct additional tax from your monthly payments. For example, if your total income puts you into a higher tax bracket, increasing the tax at source may help you avoid a big bill at tax time. We recommend discussing your overall tax situation with a tax adviser or the CRA.
To request or to change the additional amount of tax withheld from your monthly pension payments, there are several ways to do so:
Change your tax online by logging into myOMERS.
Sign and submit a Changing Information (retired member or survivor) form to OMERS.
Send OMERS a signed letter, with your full name (printed), OMERS reference number (or social insurance number), and the total additional monthly amount you want withheld.
If you receive more than one OMERS pension (e.g., from OMERS Primary Plan and from the RCA) you will need to submit a separate additional tax request for each pension.
The basic personal amount is the income threshold at which CRA begins to deduct taxes. This amount is indexed to inflation, based on the Canadian Consumer Price Index (CPI) as reported by Statistics Canada. An increase in the basic personal amount means a greater portion of your pension income is not taxed. Visit the Canada Revenue Agency (CRA) website for the current basic personal amount.
A retro-payment is likely be taxed at a higher rate than monthly pension payments. The tax on monthly payments is calculated on an annualized basis using a blended tax rate. Each portion of the monthly pension payment is placed into the applicable tax bracket, as set out by the CRA.
Have a look at these sample tax rates:
10% for annual income up to $30,000 | 20% for annual income from $30,000 to $60,000 | 30% for annual income over $60,000 |
For a $3,000 monthly pension payment ($36,000 annually), a portion is taxed at 10% and a portion is taxed at 20%. A retro-payment of $3,500 would be taxed at 20% because it falls in the $30,000 to $60,000 income range.
When you file your tax return, your total OMERS income, including the retro-payment, is factored in with the tax paid for the year. If your tax paid is in excess of what is required on your income from all sources (e.g., CPP, OAS, RRIFs, etc.), you would get a refund from CRA.
Inflation protection increases OMERS retirement, disability and survivor pensions each year, based on the increase in the Consumer Price Index (CPI), as follows:
Benefits earned on or before December 31, 2022 receive full inflation protection, up to a maximum increase of 6%. Any excess is carried forward to later years when the CPI increase is less than 6%, provided the pension is still in pay.
Benefits earned on or after January 1, 2023 are subject to Shared Risk Indexing (SRI), meaning that the level of inflation protection will depend on the OMERS Sponsors Corporation (SC) Board’s annual assessment of the financial health of the OMERS Plan.
The increase as of January 1, 2024 is 4.42%.
In December, we send retired members and survivors a personalized Annual Statement of Pension showing the details of their January pension increase. The statements are posted on myOMERS, then mailed to members who receive their pension information by paper mail.
Activate your myOMERS account to get your statement as soon as it is available online at myOMERS.com.
For pensions that are in pay based on benefits earned prior to January 1, 2023, each January, the eligible pension increases by 100% of the increase in the Canadian CPI, up to a maximum increase of 6%. If the CPI increase is greater than 6%, pensions eligible for an inflation adjustment will increase by this 6% maximum but the excess (i.e., the applicable CPI increase above 6%) is carried forward for application in a future year when the CPI increase is less than 6%, provided the pension is still in pay.
CPI measures approximate changes in the cost of living based on the price of a basket of goods and services that an average Canadian household buys. The basket includes food, housing, transportation, energy, furniture, clothing and recreation. More information about the CPI is available on Statistics Canada's website.
Pensions in respect of benefits earned on or after January 1, 2023 are subject to Shared Risk Indexing (see above).
In respect of benefits earned prior to January 1, 2023, OMERS uses the average of the CPI for the 12-month period ending in October and compares it to the average for the same period the previous year. The percentage increase determines the inflation adjustment increase for eligible OMERS pensions, up to a maximum increase of 6%.
OMERS method of calculating the annual inflation increase (i.e., the CPI increase) is consistent with the method used by the Canada Pension Plan (CPP), except OMERS rounds the results to two decimal places while CPP rounds to one decimal place. For benefits earned prior to January 1, 2023, the applicable CPI increase will equal the OMERS inflation adjustment in most years except in the case where the CPI exceeds 6%.
In respect of benefits earned on or after January 1, 2023, increases are subject to Shared Risk Indexing, meaning that the level of inflation protection will depend on the OMERS Sponsors Corporation (SC) Board’s annual assessment of the financial health of the OMERS Plan.
Your first increase may be pro-rated based on the month your pension started. For example, the increase as of January 1, 2024 is 4.42%. If your pension started in February 2023, your 2024 increase would be 3.68% (which is 0.8333 of 4.42%), following the decision that the annual inflation adjustment to pensions in pay will not be impacted by SRI in 2024 and 2025. In January 2025, your pension will receive the full applicable 2025 increase provided the pension is still in pay.
The proration of your pension must be calculated in accordance with the OMERS Plan text, which sets out the proration factors. The table below shows the proration factors for each month. These factors represent the number of months remaining in the year after your first pension payment and determines the applicable increase to your pension on the following January 1. For example, if your pension started in February 2023, the 0.8333 proration effective on January 1, 2024 reflects the 10 months in 2023 that your pension was being paid (i.e., 10 months ÷ 12 months) after your first payment.
Any member whose pension received an inflation adjustment effective January 1, 2023 and whose pension is still in pay on January 1, 2024 will receive the 0.51% excess inflation adjustment in addition to the 4.42% inflation adjustment effective January 1, 2024 for a total inflation adjustment of 4.93%.
The 6% maximum inflation adjustment provided on January 1, 2023 affected Plan members who were in receipt of a pension and eligible for inflation adjustments. Specifically, all members and survivors of members with pensions in pay on January 1, 2023 were affected if they started their pensions prior to December 1, 2022.
In addition, the 6% maximum affected some deferred vested members who were eligible for pre-retirement indexing, which is the inflation protection OMERS applies to a member’s deferred benefit between the date a member stops working for an OMERS employer and the date their pension begins. Pre-retirement indexing is applicable for members who terminate employment with their OMERS employer after their early retirement birthday [55th birthday for normal retirement age (NRA) 65 or 50th birthday for NRA 60]. Otherwise, pre-retirement indexing for a deferred vested pension is only applicable in respect of benefits based on pre-2013 credited service, if any.
No, the 6% maximum inflation adjustment has been in the OMERS Plan text since the early 1990s. However, prior to January 1, 2023, the inflation adjustments have not exceeded 6%.
For a pension that began in… | Pro-rating (first increase only) |
|---|---|
January 2023 | 0.9167 |
February 2023 | 0.8333 |
March 2023 | 0.7500 |
April 2023 | 0.6667 |
May 2023 | 0.5833 |
June 2023 | 0.5000 |
July 2023 | 0.4167 |
August 2023 | 0.3333 |
September 2023 | 0.2500 |
October 2023 | 0.1667 |
November 2023 | 0.0833 |
December 2023 | 0.0000 |
In respect of benefits earned prior to January 1, 2023, OMERS determines the CPI increase as the average of the CPI for the 12-month period ending in October over the average for the same period the previous year. If the CPI increase is greater than 6%, the inflation adjustment is 6% and the excess of the CPI increase above 6% is carried forward for application in a future year when the CPI increase is less than 6%, provided the pension is still in pay. Generally, the excess would be added to the following year’s inflation adjustment if it is possible to do so.
If a member passes away prior to the year that the excess amount is added to the inflation adjustment and no further benefits are payable at the member’s death, no further indexing will be applicable. If a pension is payable to the member’s surviving spouse and/or dependent children, the calculation of their pension amounts will continue to be eligible for inflation adjustments (including the excess inflation adjustment, if applicable).
Here’s an example: The January 1, 2023 inflation adjustment exceeded the 6% maximum by 0.51%. Using the inflation adjustment effective January 1, 2024 (applies to all benefits, as a result of the decision that the annual inflation adjustment to pensions in pay will not be impacted by SRI in 2024 or in 2025) of 4.42%, the impact on a $100 annual pension of a retired member or deferred vested member who is eligible for pre-retirement indexation will be different depending on the member’s circumstances. Consider the following three scenarios:
Scenario 1: The member’s retirement or termination of employment occurred prior to 2022,
Scenario 2: The member’s retirement or termination of employment occurred on June 1, 2022
Scenario 3: The member’s retirement or termination of employment occurred on June 1, 2023
Scenario | On January 1, 2023 | On January 1, 2024 |
|---|---|---|
(1) Retired / Terminated Prior to 2022. Pension in 2022 is $100.00. | Inflation adjustment = 6% $100.00 pension increases to $106.00 for 2023 | Inflation adjustment = 4.42% + 0.51% $106.00 pension increases to $111.23 for 2024 |
(2) Retired / Terminated June 1, 2022. Pension in 2022 is $100.00 | Inflation adjustment pro-rated = 3% (6% x 0.5000) $100.00 pension increases to $103.00 for 2023 | Inflation adjustment = 4.42% + 0.51% $103.00 pension increases to $108.08 for 2024 |
(3) Retired / Terminated June 1, 2023. Pension in 2023 is $100.00 | N/A | Inflation adjustment pro-rated = 2.21% (4.42% x 0.5000) $100.00 pension increases to $102.21 for 2024 |
Here’s how pro-ration works: In Scenario 2, on January 1, 2023, the member received a pro-rated inflation adjustment (i.e., the 6% inflation adjustment was pro-rated to 3% because the pension was in pay, or became deferred, for half of 2022). In the example, the member in Scenario 2 would be eligible to receive the excess adjustment of 0.51% without pro-ration as part of the January 1, 2024 inflation adjustment, provided the member’s pension benefit is still payable. Contrast this to Scenario 3 where the member was an active member on January 1, 2023 and was not eligible for an inflation adjustment while still accruing benefits. In this case, the member receives their first inflation adjustment on January 1, 2024 based on the applicable CPI increase of 4.42% on a pro-rated basis.
This Income Tax Act provision allows retired couples to reduce their overall taxes.
A retiree can allocate up to half of their pension income to their lower-income spouse or partner when filing a tax return. This feature is designed to drop the higher-income spouse or partner into a lower tax bracket.
Information and application forms are at the Canada Revenue Agency (CRA) website.
Your OMERS Plan pension is eligible for pension income splitting.
Retirement compensation arrangement (RCA) benefits – The RCA benefit is eligible for income splitting after age 65 (subject to limits). Before age 65, the RCA benefit is not eligible for income splitting. The RCA is a separate fund that pays benefits over and above the maximum pension that the OMERS Plan is permitted to pay according to the Income Tax Act.
Pension income splitting is set up through Canada Revenue Agency (CRA), not through OMERS.
The retired member and the spouse or partner must complete a Form T1032, Joint Election to Split Pension Income.
There is a line on the income tax return for the retired member to deduct the pension amount allocated to their spouse, and one for the spouse to report the allocated pension amount.
Age 65 is a milestone for OMERS retired members. For instance:
age 65 is a good time to think about medical insurance
the amount of your OMERS pension changes
some important federal benefits become available to you.
Age 65 is often a turning point for medical benefits:
employer medical and dental coverage may end at 65;
Ontario residents become entitled to benefits under the Ontario Drug Benefit Program when they turn 65, but some products may not be covered, e.g., eyeglasses or prescription drugs bought outside Ontario; and
it may have been several years since you assessed your medical insurance needs.
While we cannot endorse or guarantee any of these products or services from the organizations below, we have agreed to pass along their information to help with insurance planning.
Be sure to identify yourself as an OMERS member if you enquire about coverage for any of these special offers.
Organization | Contact information |
|---|---|
Health, dental, travel, home, auto and life insurance for retired education employees | RTOERO Tel: 416-962-9463 Toll free: 1-800-361-9888 E-mail: info@rtoero.ca |
Mitchell & Abbott Group Insurance Brokers Property and automobile insurance | Mitchell & Abbott Group Insurance Brokers P.O. Box 6040, Station ‘D' Hamilton, Ontario L8V 5C4 Tel: 1-800-463-5208 E-mail: tgraves@mitchellabbottgrp.com |
Health, dental, travel, life insurance, and RecoverEase insurance plans for retirees | Victor Insurance Managers Inc. 600 - 55 Standish Court Mississauga, Ontario L5R 4B2 Tel: 1-800-363-7861 e-mail: mroo.ca@victorinsurance.com |
PlanDirect Insurance Health and Dental Insurance | Individual Health Services Great-West Life 200 - 211 Consumers Road Toronto, Ontario M2J 4G8 Tel: 1-800-565-4066 or 416-490-0072 e-mail: plandirect@gwl.ca |
Organization | Contact information |
|---|---|
Health, dental, travel, home, auto and life insurance for retired education employees. | OTIP 125 Northfield Drive West P.O. Box 218 Waterloo, Ontario N2J 3Z9 Tel: 1-800-267-6847 or 519-888-9683 |
Police Pensioners Association of Ontario (PPAO) Sun Life Benefit Plan Health, dental and travel insurance for police retirees and family members | Sun Life Benefit Plan Mike Kelly CFP CHS 1202 Lambton Mall Rd Sarnia, Ontario N7S 5R6 Tel: 519-542-7779 ext. 2213 or 1-866-282-3924 ext. 2213 Fax: 519-542-2560 E-mail: mike.f.kelly@sunlife.com |
Medallion Group Insurance for First Responders 604 Belmont Ave W Kitchener, ON N2M 1N5 Tel: 1-800-339-9935 Fax: 1-888-416-6911 E-mail: medallioninfo@mcfr.ca | |
Special Benefits Insurance Services Individual health, dental and travel insurance specialists for retirees looking to continue their coverage. | Special Benefits Insurance Services 366 Bay Street, 7th Floor Toronto, Ontario M5H 4B2 Tel: 1-800-667-0429 E-mail: general@sbis.ca |
Your OMERS pension is designed to work with the Canada Pension Plan (CPP) to help provide a secure, total retirement income.
If you retire before age 65, the bridge benefit supplements your OMERS pension until age 65, when it is expected that most members will start their CPP pension. The OMERS bridge benefit continues to be paid to age 65 even if you start your CPP pension before age 65. From age 65 onward, you continue to collect your lifetime pension. Just before you turn 65, you will receive a notice from OMERS detailing the change to your pension.
While you work and contribute to the OMERS Plan, you pay a lower OMERS contribution rate on the portion of your earnings up to the year’s maximum pensionable earnings (YMPE)($68,500 in 2024).
Your CPP pension is based on how long you have worked and contributed to CPP. The OMERS bridge benefit is based on your credited service in OMERS. The two amounts are not linked and may be quite different.
0.675% x credited service (years) x lesser of "best five" earnings or AYMPE (Five-year average of the YMPE)
If you haven't already started to receive your CPP pension, be sure to take the steps necessary to ensure you receive the benefit you've earned. Your CPP benefit is not sent automatically; you must apply for it.
Application kits are available from Human Resources and Skills Development Canada either online or from the local office in your area.
Other government benefits include the Old Age Security (OAS) program, which is supplemented by the Guaranteed Income Supplement and the Allowance for low-income seniors. When you turn 65, you may be entitled to these benefits. Like CPP, you must apply for these benefits.
Each spring, the Municipal Retirees Organization Ontario (MROO) hosts Zone Meetings across the province.
MROO's president provides an update on MROO's advocacy on behalf of pensioners.
OMERS staff share information about the pension plan and are available to answer questions.
Guest speakers address a variety of topics of interest to retirees.
All OMERS retirees are invited.