OAS Clawback Calculator
Above $95,323 of 2026 net income, every extra dollar costs you 15 cents of Old Age Security. Enter your income to see your recovery tax, your reduced monthly OAS, and how close you are to losing it entirely — using the correct threshold for each income year, and the payment-timing rule most calculators skip.
How the clawback works
Formally the OAS pension recovery tax, the clawback takes back 15 cents of OAS for every dollar of net world income above the year's minimum threshold, until your OAS reaches zero:
clawback = 15% × (net world income − threshold), capped at your annual OAS
2026 income: threshold $95,323 · full clawback ≈ $154,708 (65–74) / $160,646 (75+)
2025 income: threshold $93,454 · full clawback $152,062 (65–74) / $157,923 (75+)
Two mechanics catch people out. First, the timing lag: the CRA tests last year's income against the threshold and deducts the result from your payments starting the following July — 2026 income shapes your July 2027 – June 2028 cheques. A one-time income spike (selling a rental, a big RRIF withdrawal) haunts you a year later.
Second, the income definition: it's net world income on line 23400, which grosses up eligible Canadian dividends by 38% — $10,000 of dividends counts as $13,800 against the threshold — and includes OAS itself. TFSA withdrawals are invisible to it, which is why the TFSA is the central planning tool around this tax.
Worked example: $110,000 of 2026 income, age 68
| Line | | Amount |
|---|
| Excess over threshold | $110,000 − $95,323 | $14,677 |
| Annual recovery tax | × 15% | $2,201.55 |
| Monthly OAS reduction | ÷ 12, from July 2027 | $183.46 |
| Monthly OAS kept | $751.97 − $183.46 | $568.51 |
| Share of OAS lost | $2,201.55 ÷ $9,023.64 | ≈ 24% |
This retiree keeps three-quarters of their OAS — the clawback is real but survivable. The expensive zone is the band between the threshold and the ceiling, where every marginal dollar of income effectively carries your tax rate plus 15%. A $10,000 RRIF withdrawal in that band costs $1,500 of OAS on top of income tax — which is precisely the kind of withdrawal worth re-timing or replacing with TFSA money.
OAS clawback questions, answered
What income counts toward the clawback?
Net world income (line 23400): employment, CPP, pensions, RRSP/RRIF withdrawals, rental income, interest, capital gains, and grossed-up eligible dividends ($10,000 counts as $13,800). OAS itself is included. TFSA withdrawals don't count.
When does the clawback actually reduce my payments?
With a one-year lag: 2025 income (threshold $93,454) reduces July 2026 – June 2027 payments; 2026 income (threshold $95,323) reduces July 2027 – June 2028. The CRA calculates it from your filed return.
Is the threshold per person or per couple?
Per person — each spouse is tested individually. That's why pension income splitting (up to 50% of eligible pension income) can pull the higher earner back under the line.
How can I reduce it?
Spend from a TFSA; split pension income; melt down RRSPs before OAS starts; time or spread large capital gains; defer OAS (+0.6% per month, up to 36% at 70) while thresholds rise with inflation. Form T1213(OAS) can reduce withholding if this year's income has dropped.
Why is the ceiling higher for 75+?
Since July 2022, those 75+ get a permanent 10% larger OAS. More pension takes more income to claw back at 15 cents per dollar, so the ceiling is about $160,646 for 2026 income versus $154,708 for ages 65–74.
Is losing OAS always bad?
Full clawback means retirement income above roughly $155,000 — the plan worked. The costly zone is just above the threshold, where forced RRIF withdrawals lose 15 cents per dollar on top of tax. That's where planning pays.
Looking for the other end of the scale? The CPP + OAS + GIS calculator shows your total government retirement income, including the Guaranteed Income Supplement for lower incomes.
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