OAS clawback calculator
If your retirement income climbs past a certain point, the government quietly takes back part of your Old Age Security through the OAS recovery tax — 15 cents for every dollar over the threshold. Enter your income below to see how much OAS you keep in 2026, and how much gets clawed back.
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How to read this: the bottom axis is your net income. The green line is how much OAS you keep. It's flat until the $95,323 threshold, then falls by 15 cents per extra dollar of income until it hits zero at the full-clawback point. The dashed vertical line is the income you entered above.
2026 thresholds — and how they've moved
| Tax year | Clawback starts | Gone (65–74) | Gone (75+) |
|---|---|---|---|
| 2024 | $90,997 | $148,065 | $153,771 |
| 2025 | $93,454 | $151,959 | $157,810 |
| 2026Now | $95,323 | $154,708 | $160,647 |
What is the OAS clawback?
The OAS clawback — officially the Old Age Security pension recovery tax — is a special tax that claws back part or all of your OAS once your income passes an annual threshold. For 2026, that threshold is $95,323 of net world income. Above it, you repay 15 cents of OAS for every dollar of income, until your OAS is gone entirely.
- Threshold (2026): $95,323 — below this, you keep 100% of your OAS.
- Recovery rate: 15% of every dollar above the threshold.
- Fully clawed back at: about $154,708 (age 65–74) or $160,647 (age 75+).
It's based on your net world income (line 23400), before the recovery deduction itself — so worldwide income from CPP, workplace pensions, RRSP and RRIF withdrawals, taxable capital gains, and grossed-up Canadian dividends all count. Money you withdraw from a TFSA does not, which is the key to most clawback-avoidance strategies.
How to calculate the OAS clawback (with an example)
The formula is simple — our OAS clawback calculator runs it for you, but here it is by hand:
Clawback = 15% × (net income − $95,323), capped at the total OAS you received
Worked example for 2026: say you're 68 with a net world income of $110,000 and you collect the maximum OAS of about $743/month ($8,917/year). Your income is $14,677 over the $95,323 threshold, so the recovery tax is 15% × $14,677 = $2,202 for the year — roughly $183 a month clawed back. You still keep about $6,715 of your OAS. Push income to $154,708 and the full $8,917 is gone; stay at or below $95,323 and you keep every dollar.
Watch dividends and capital gains
Two kinds of income inflate your clawback more than people expect. Eligible Canadian dividends are "grossed up" by 38% on your return — so $10,000 of dividends shows up as roughly $13,800 of net income for the clawback test, even though the dividend tax credit later offsets the actual tax. Taxable capital gains count too, so selling a cottage or rebalancing a big non-registered account in one year can trigger a clawback that wouldn't happen if the gain were spread out.
How to reduce or avoid the OAS clawback
Lower your taxable income
- Split eligible pension income with a spouse to shift income to the lower earner — see pension income splitting.
- Draw from your TFSA instead of your RRSP/RRIF — TFSA withdrawals don't count as income.
- Contribute to an RRSP (or spousal RRSP) if you still have earned income at 65+.
Time your income
- Melt down your RRSP early — draw it down before 65 (or before starting OAS) to shrink later RRIF income.
- Bunch capital gains into a single year rather than spreading them across several OAS years.
- Consider delaying OAS to 70 if your highest-income years come first — you receive a larger, later pension over fewer high-income years.
What this calculator doesn't model
This tool estimates the OAS recovery tax in isolation, using 2026 figures. It does not model the July-to-June recovery-tax timing (the monthly reduction is based on your previous year's income and reconciled when you file), the Guaranteed Income Supplement, provincial senior benefits, or your full income-tax bill. For a complete, tax-aware projection, use the full retirement planner, and see when to take CPP to coordinate your timing.
Frequently asked questions
What income triggers the OAS clawback in 2026?
The OAS recovery tax starts once your net world income passes $95,323 for 2026. For every dollar above that threshold, you repay 15 cents of your Old Age Security. Below the threshold you keep your full OAS.
How much is the OAS clawback?
The clawback (officially the OAS recovery tax) is 15% of the amount your net income exceeds the threshold — 15 cents for every dollar over $95,323 in 2026 — up to the total OAS you received that year. It works like an extra 15% tax band layered on top of your regular income tax.
At what income is OAS fully clawed back in 2026?
Your entire OAS is recovered once income reaches about $154,708 if you are 65–74, or $160,647 if you are 75 or older. The 75+ cut-off is higher because that age group receives a 10% larger OAS, so it takes more income to claw all of it back.
How do I avoid the OAS clawback?
You avoid or shrink the clawback by keeping your net world income below the $95,323 threshold (2026). The most effective levers: draw retirement income from your TFSA instead of your RRSP/RRIF, since TFSA withdrawals don’t count as income; split eligible pension income with a spouse to shift income to the lower earner; melt down your RRSP early — before 65 or before starting OAS — to shrink later RRIF minimums; and bunch capital gains into a single year rather than spreading them across several OAS years. Some retirees also defer OAS to 70 if their highest-income years come first.
Is the OAS clawback based on net or gross income?
It is based on your net world income — line 23400 on your tax return, calculated before the OAS recovery deduction itself. It includes worldwide income: employment, CPP, pensions, RRSP/RRIF withdrawals, taxable capital gains, and grossed-up Canadian dividends.
Does TFSA income count toward the OAS clawback?
No. TFSA withdrawals and the growth inside a TFSA are not taxable income, so they never count toward the clawback threshold. This is why drawing retirement income from a TFSA, rather than an RRSP/RRIF, is one of the most effective ways to stay under the limit.
Is the OAS clawback calculated per person or per couple?
Per person — it is based on each individual’s own net income, not household income. That is why couples often split eligible pension income to move income from the higher-earning spouse to the lower one, reducing or avoiding the clawback for the household.
When is the OAS clawback actually deducted?
The recovery tax period runs July through June and is based on your previous tax year’s income. Service Canada reduces your monthly OAS over that period, then the amount is reconciled when you file your return — so a change in income can mean a recovery or an extra refund later.
How do I calculate the OAS clawback?
Take your net world income, subtract the $95,323 threshold (2026), and multiply the excess by 15%. For example, $110,000 of income is $14,677 over the threshold, so the clawback is 15% × $14,677 = $2,202 for the year, capped at the total OAS you received. This OAS clawback calculator runs that math automatically as you change your income.
Do dividends and capital gains count toward the OAS clawback?
Yes. Taxable capital gains are included in net income, and eligible Canadian dividends are grossed up by 38% before they hit line 23400 — so dividends can push you over the threshold faster than their cash value suggests. Bunching capital gains into a single year, or spreading them out, can change how much OAS you lose.
Educational tool, not financial advice. Figures reflect 2026 rules (recovery threshold $95,323; 15% recovery rate; maximum OAS $743.05/month at 65–74 and $817.36/month at 75+). Verify your situation with the CRA or a tax professional.