Ontario is home to more retirees than any other Canadian province. Planning for retirement in Ontario requires understanding both federal programs (CPP, OAS, GIS, RRSP, TFSA) and Ontario-specific taxes, credits, and senior benefits. This guide covers what is unique about retiring in Ontario compared to the rest of Canada.
Ontario uses a graduated income tax system on top of federal taxes. For retirees in 2025, Ontario's provincial income tax brackets are approximately:
Combined federal and Ontario tax rates (federal + provincial) for retirement income reach approximately 46.41% at the highest bracket. Ontario also has a surtax that adds additional provincial tax for higher-income residents, making Ontario one of the higher-taxed provinces for upper-middle and high income retirees.
Ontario's GAINS program provides up to $83/month ($996/year) to low-income seniors who are already receiving federal GIS. GAINS is a provincial top-up to ensure Ontario's lowest-income seniors have slightly more income than federal programs alone provide. To qualify, you must be receiving GIS from the federal government and be a resident of Ontario. GAINS is automatically calculated when you receive GIS — no separate application is needed.
All Ontario residents aged 65+ are eligible for the Ontario Drug Benefit program, which covers a significant portion of prescription drug costs. There is a small deductible and co-payment for most seniors (approximately $100 deductible, then $6.11 per prescription), but the program provides significant savings for retirees on multiple medications. Low-income seniors on GIS may qualify for reduced or eliminated copayments.
As of 2024, Ontario (and federally through the Canadian Dental Care Plan) provides dental coverage to eligible seniors. Ontario seniors with annual incomes below $70,000 (single) or $70,000 (per household income limits) may be eligible for coverage under the federal Canadian Dental Care Plan, which was launched in 2023 and expanded to seniors in 2024.
The Ontario Trillium Benefit combines the Ontario Energy and Property Tax Credit, the Northern Ontario Energy Credit, and the Ontario Sales Tax Credit into one monthly payment. Retirees on low or modest fixed incomes may qualify, particularly if they are renters (the property tax credit applies to renters paying rent that includes property taxes). The amount varies based on income, family status, and housing costs.
Ontario senior homeowners with lower incomes may qualify for a property tax grant to help offset property tax costs. The maximum grant amount varies by year and income level.
Ontario does not have its own provincial pension plan separate from CPP. All Ontario workers contribute to CPP. The 2016 "Ontario Retirement Pension Plan" proposal was abandoned after the federal government enhanced CPP. Ontario workers receive CPP retirement benefits administered federally.
Ontario has some of the highest living costs in Canada, particularly in the Greater Toronto Area. Housing is the biggest factor — whether you own or rent, housing costs in Toronto are among the highest in North America. Retirees on fixed incomes need to plan carefully around housing, especially if property taxes and maintenance costs are significant.
Some Ontario retirees choose to relocate to lower-cost cities in Ontario (Kingston, Belleville, Windsor, Thunder Bay) or other provinces (particularly Atlantic Canada or certain areas of Quebec) to stretch their retirement income further. The decision to stay in a high-cost area vs. relocate is one of the most significant financial decisions Ontario retirees face.
Ontario's relatively high provincial tax rate makes RRSP contributions particularly valuable during high-income working years (the deduction is worth more). However, the same high rates mean RRIF withdrawals are also more taxed than in lower-rate provinces like Alberta. Strategies to minimize provincial tax in retirement include:
Ontario has specific rules for locked-in pension assets. A key Ontario-specific provision is the one-time 50% unlocking: when you convert your Ontario-governed LIRA to a LIF (after age 55), you can transfer up to 50% of the balance to an RRSP or RRIF — removing the locked-in restriction on half your pension. This is administered through FSRA (Financial Services Regulatory Authority of Ontario).
To maintain a $70,000/year retirement lifestyle in Toronto (including rent or carrying costs of modest housing, basic car or transit, utilities, food, healthcare supplements, and entertainment), you would need significantly more in savings than in many other Canadian cities. A rough comparison:
Ontario's probate process (Estate Administration Tax) charges 1.5% on the value of the estate above $50,000. On a $1 million estate, that's $14,250 in probate fees. Strategies to reduce probate include:
RRSP and RRIF assets with a named beneficiary pass directly to the beneficiary without probate, which can save significant fees on large registered accounts.
Every dollar saved on banking fees compounds in your RRSP or TFSA. KOHO offers a free account with no monthly fees and no minimum balance. Use code 45ET55JSYA for a bonus.
Open KOHO Free — No Fees — Code 45ET55JSYA