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Overpayments and repayments

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An OAS overpayment, or a GIS or CPP overpayment, means you were paid more than you were entitled to, and the law treats the extra as a debt you must repay. If you think the overpayment is wrong, ask Service Canada for a reconsideration in writing within 90 days of the letter. If it is right but you cannot afford to repay it quickly, you can ask for a payment arrangement, and in some cases ask for the debt to be reduced or cancelled.

Key facts

Deadline to dispute an overpayment decision
90 days from the day you receive the decision letter
Can the government recover it from future payments?
Yes, it can be deducted from benefits you receive
Time limit to collect
None set in the OAS Act or CPP Act: the debt is recoverable at any time
Grounds to have it cancelled (remission)
Undue hardship, administrative error or wrong advice, cannot be collected, or collection would cost more than the debt
CRA line for CPP overpayment debts
1-866-864-5823

What is an OAS overpayment?

An overpayment happens when Service Canada pays you more OAS, GIS, Allowance or CPP than you were entitled to. Under the Old Age Security Act and the Canada Pension Plan, you must return any payment you were not entitled to. The extra amount becomes a debt to the federal government.

You may first learn about it from a letter that says how much you owe and why. Read it carefully. The reason and the time period it covers will tell you whether the decision is right.

Why do overpayments happen?

Some overpayments come from Service Canada's own mistakes. How the overpayment happened can matter if you later ask for the debt to be cancelled.

How to respond to an overpayment letter

  1. Do not ignore the letter. Note the date you received it, because your deadline counts from that day.
  2. Check the facts: the dates, the amounts, the reason, and the income or absence it is based on.
  3. Call Service Canada if you do not understand how the amount was worked out. The numbers are listed below.
  4. If you think the overpayment is wrong, ask for a reconsideration in writing within 90 days. Use form ISP-3134 for OAS and GIS, or ISP-1238 for CPP, or ask online in My Service Canada Account. Say exactly what is wrong and include proof.
  5. If the amount is right but you cannot repay it all at once, ask for a payment arrangement you can afford.
  6. If repaying would cause you hardship, or if the overpayment came from a government error or wrong advice, ask in writing for the debt to be remitted (cancelled in full or in part). Explain your reasons and include proof.
  7. Keep copies of everything you send and receive.

You can ask for a reconsideration and also ask about hardship or error. One does not rule out the other. Do not let the 90-day reconsideration deadline pass while you wait on other questions.

What to include when you dispute or ask for relief

For a reconsideration, include your name, address, phone number, Social Insurance Number or client ID, a detailed explanation of why you disagree, any new documents, your signature and the date.

For a payment arrangement or a hardship request, be ready to show your full financial picture. CRA's policy asks for evidence of your income, expenses, assets and debts. Helpful records include:

If you believe Service Canada caused the overpayment, describe what happened, when you reported the change, and who you spoke to, if you know.

How is an overpayment repaid?

The law allows the debt to be deducted from benefits you receive in the future. It can also be collected through the courts. Neither the Old Age Security Act nor the Canada Pension Plan sets a time limit: the debt is recoverable at any time.

The Canada Revenue Agency (CRA) collects CPP and OAS overpayment debts for Employment and Social Development Canada (ESDC). CRA can take your income tax refund or GST/HST credit and apply it to the debt. CRA will consider a payment arrangement based on your ability to pay. Its policy says undue hardship means repayment would leave you without the necessities of life, such as housing, food, clothing, medical care and utilities. In those cases CRA may pause collection or change your arrangement.

CRA only collects the debt. If you disagree with the debt itself, you must contact or write to ESDC (Service Canada), not CRA.

Can an overpayment be forgiven or written off?

Yes, in some cases. Both the Old Age Security Act and the Canada Pension Plan let the Minister remit, meaning cancel, all or part of an overpayment if satisfied that:

Remission is a decision made at the government's discretion, and it is not automatic. Ask in writing, give your reasons, and send proof. The CPP law also says that if wrong advice or an administrative error caused you to be denied a benefit, the Minister must take steps to put you in the position you would have been in.

What about penalties and interest?

Penalties apply when someone knowingly gives false or misleading information or leaves information out. Interest is charged on penalties and on overpayments that are subject to a penalty. If you realize you gave wrong information, you can correct it before an investigation starts. This is called a voluntary disclosure, and it may protect you from a penalty. Call Service Canada or visit a Service Canada Centre.

What happens next, and what if it goes against you?

After a reconsideration, you will receive a new decision by mail. Service Canada says this can take several months. If you still disagree, you can appeal to the Social Security Tribunal within 90 days of receiving the reconsideration decision. See our guides on asking for a decision to be reviewed and on appealing to the Social Security Tribunal.

Things people often miss

Where to get free help

This guide is general information, not legal advice, and no one can promise a debt will be reduced. In Ontario, community legal clinics help with OAS, GIS and CPP overpayments at no cost. Legal aid offices and clinics in other provinces may help. Your Member of Parliament's constituency office can ask Service Canada about your file. A free tax clinic or credit counselling service can help you prepare a budget for a payment arrangement.

Who to contact

Common questions

What do I do if I get an OAS overpayment letter?

Check the reason and the amount. If it is wrong, ask Service Canada for a reconsideration in writing within 90 days. If it is right, ask for an affordable payment arrangement.

Do I have to pay back an OAS or GIS overpayment?

Usually, yes. The law makes it a debt. It can be cancelled in some cases, such as undue hardship or a government error.

Can a CPP overpayment be forgiven?

The Minister can cancel all or part of it for undue hardship, administrative error or wrong advice, or if it cannot be collected. You need to ask in writing and show proof.

Why is CRA collecting my CPP or OAS overpayment?

CRA collects these debts for Employment and Social Development Canada. CRA can set up a payment arrangement, but questions about whether the debt is correct go to Service Canada.

Can the government take my tax refund for an overpayment?

Yes. CRA can apply your income tax refund or GST/HST credit to the debt.

Is there a time limit to collect an OAS or CPP overpayment?

No time limit is set in either law. The debt is recoverable at any time.

How do I set up a payment plan for a CPP or OAS overpayment?

Contact CRA's debt line (listed below) or Service Canada. Be ready to show your income, expenses, assets and debts.

Will I be charged interest on an overpayment?

Interest is charged on penalties and on overpayments that are subject to a penalty, which apply when false or missing information was given knowingly.

Sources

  1. Old Age Security Act (R.S.C., 1985, c. O-9) (Justice Laws Website, Government of Canada)
  2. Canada Pension Plan (R.S.C., 1985, c. C-8), section 66 (Justice Laws Website, Government of Canada)
  3. Request a reconsideration - Old Age Security pension and benefits (Government of Canada)
  4. CPP benefits - Request a reconsideration (Government of Canada)
  5. CPP and OAS: Penalties, interest and disclosure policy (Government of Canada)
  6. Guaranteed Income Supplement - While receiving GIS (Government of Canada)
  7. IC13-2R1 Government programs collection policies (Canada Revenue Agency)
  8. Types of debt collected by the CRA (Canada Revenue Agency)
  9. Call us if you can't pay in full or on time - Debt collection at the CRA (Canada Revenue Agency)
  10. The Canada Revenue Agency has options for you if you owe us money or have a debt that we collect for another government department (Canada Revenue Agency)
  11. Old Age Security and Guaranteed Income Supplement appeals: Process at a glance (Social Security Tribunal of Canada)
  12. Contact Old Age Security (Government of Canada)

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