What is the OAS clawback threshold in 2026?

The OAS recovery tax threshold for the July 2025 to June 2026 benefit period is $90,997 net income. This figure is based on 2024 net income as reported on the T1 return. The threshold is adjusted annually by CRA and published each July when the new benefit period begins. For the 2025 benefit year (July 2024 to June 2025) the threshold was $86,912.

How is the OAS clawback calculated?

The OAS recovery tax equals 15% of net income above the threshold. For 2026: recovery tax = 0.15 x (net income minus $90,997), to a maximum of the total OAS received. If net income is $110,000, the clawback is 0.15 x ($110,000 minus $90,997) = 0.15 x $19,003 = $2,850. This amount is deducted from OAS payments in the following benefit year.

What net income triggers full OAS elimination?

For recipients aged 65 to 74, full elimination occurs when the clawback equals the maximum annual OAS of approximately $8,916 (January 2026 quarterly maximum annualised). At 15%, this occurs at $90,997 + ($8,916 / 0.15) = approximately $150,437 net income. For recipients aged 75 and older receiving the 10% enhancement ($9,808 annually), full elimination occurs at approximately $90,997 + ($9,808 / 0.15) = approximately $156,317.

Does the OAS clawback apply to TFSA withdrawals?

No. TFSA withdrawals are not included in net income and do not trigger the OAS clawback. This makes TFSA accounts particularly valuable for retirees at risk of the clawback. Drawing living expenses from the TFSA rather than an RRIF or non-registered account can keep net income below the threshold.

Can pension income splitting reduce the OAS clawback?

Yes. Eligible pension income splitting shifts up to 50% of qualifying pension income from the higher-income spouse to the lower-income spouse, reducing the higher-income spouse's net income for clawback purposes. Eligible income for splitting includes RPP pension benefits and RRIF withdrawals for recipients aged 65 or older. CPP benefits are split separately through the CPP credit-splitting mechanism and do not use the pension income splitting election.

Does deferring OAS reduce the clawback?

Deferring OAS reduces clawback indirectly in two ways. First, if net income is expected to drop in a future year (for example, after completing RRIF minimum withdrawals or reducing employment income), receiving OAS in that lower-income year means less or no clawback. Second, the deferred OAS amount is larger (0.6% per month of deferral), so the break-even with early receipt must be weighed against the clawback reduction benefit. The OAS deferral decision should model net income year by year.

Does the OAS clawback affect QPP or CPP benefits?

No. The OAS recovery tax applies only to OAS payments. CPP and QPP retirement benefits are not subject to clawback, though they are included in net income and contribute to the clawback calculation for OAS. There is no equivalent clawback mechanism for CPP or QPP.

Is the OAS clawback refunded if income was lower than expected?

Yes. If income in the benefit year turns out lower than in the prior year that CRA used to calculate the withholding reduction, the overpaid clawback is refunded through the T1 return. Line 23500 of the return reconciles the recovery tax. Retirees whose income varies significantly year to year should file their return promptly and may request reduced withholding from OAS if they expect lower income than the prior year.

Does OAS clawback apply to the Allowance?

No. The Allowance (paid to spouses and common-law partners of GIS recipients, aged 60 to 64) and the Allowance for Survivor are not subject to the OAS recovery tax. The clawback applies only to the OAS pension received by those aged 65 and older. However, the income of the Allowance recipient's household affects GIS eligibility for the OAS-receiving spouse.

Is OAS clawback repayment tax deductible?

Yes. The amount repaid under the OAS recovery tax is deducted at line 23500 of the T1 return as 'Social benefits repayment,' reducing net income for that year. This creates a partial offset: the deduction reduces federal and provincial income tax payable on the clawback amount, though it does not fully offset the economic cost of the clawback.

OAS Clawback Calculator Canada 2026 — Recovery Tax Estimator

Estimate the OAS recovery tax (clawback) at any net income level. Uses the 2026 threshold of $90,997 and 15% recovery rate. Shows how much OAS you retain and when it is fully eliminated.

Reviewed by Ben Stevenson, Editor Updated April 25, 2026 Source CRA 2026

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What this result means

This calculation shows the OAS recovery tax (the OAS clawback) payable at the income level entered, applied at 15% on net income above the annual threshold under Part I.2 of the Income Tax Act. The clawback fully eliminates OAS once net income reaches the upper recovery threshold. The calculator does not model the impact of deferring OAS to age 70 (which increases the monthly amount by 0.6% per month, up to 36% at 70), pension income splitting between spouses, the order in which retirement accounts are drawn down, or GIS sensitivity for lower-income years.

Practical options to consider

Starting OAS at age 65

OAS becomes payable at age 65 to claimants who meet the residency requirements in the Old Age Security Act (10 years in Canada after age 18 for partial pension; 40 years for full pension). Service Canada auto-enrols most claimants but enrolment can be verified through a My Service Canada Account.
Read the OAS 2026 changes article →
Deferring OAS to age 70

OAS can be deferred past age 65 in exchange for a 0.6% monthly increase, producing a 36% lifetime increase if started at 70. Deferral has no benefit beyond age 70. The deferral decision interacts with OAS recovery-tax exposure: a larger OAS amount claws back faster at higher incomes.
Model the impact in the OAS Clawback Calculator →
Pension income splitting

Eligible pension income can be split with a spouse or common-law partner (up to 50%) under Income Tax Act s. 60.03, with each spouse making the joint election on their tax return. Splitting often reduces the higher-income spouse's net income enough to lower OAS recovery tax. Eligible pension income includes RRIF withdrawals and most defined-benefit pension payments at age 65; CPP and OAS are not eligible for s. 60.03 splitting (CPP pension sharing is a separate application).
Read the pension comparison article →
Order of retirement-account withdrawals

Drawing from a TFSA in years where RRIF withdrawals would push income above the OAS threshold reduces taxable income for that year because TFSA withdrawals are not included in net income. RRIF minimum withdrawals are mandatory under the Income Tax Act, so the choice usually affects discretionary withdrawals above the minimum. The optimal order varies year by year depending on other taxable income.
Open the RRSP Withdrawal Tax Calculator →
GIS sensitivity for low-income seniors

GIS is a non-taxable monthly benefit for OAS recipients with low income, with the entitlement reduced by roughly 50 cents per dollar of most other income (RRSP and RRIF withdrawals are counted; TFSA withdrawals are not). For low-income seniors the GIS reduction is often the binding constraint on retirement-account withdrawal sequencing, more so than the OAS clawback.
Open the GIS Eligibility Calculator →
Coordinating timing with a spouse or common-law partner

OAS is claimed individually; each spouse meets the residency test on their own. Household OAS planning usually models the combined start ages alongside pension income splitting, RRIF withdrawal timing, and (for survivors) Allowance for the Survivor benefits available between ages 60 and 64. Decisions made by one spouse affect the other's net income through splitting.
Read the OAS 2026 changes article →

Questions to ask Service Canada, the CRA, or a CPA

At my projected retirement income, how much OAS recovery tax would apply each year?
Would deferring OAS to 70 reduce my lifetime clawback exposure, given my expected RRIF withdrawals?
Which of my retirement accounts produce income that counts toward the OAS clawback or the GIS reduction?
Can I split eligible pension income with my spouse to reduce my net income below the OAS threshold?
If my income drops in a future year, can I apply for GIS, and how does the application work?

The OAS recovery tax, commonly called the OAS clawback, reduces Old Age Security payments for recipients whose net income exceeds a threshold set annually by the Canada Revenue Agency. For the July 2025 to June 2026 benefit period, the threshold is $95,323. For every dollar of net income above that amount, OAS is reduced by $0.15. The full annual OAS benefit is eliminated when net income reaches approximately $148,000 for recipients aged 65 to 74, and approximately $153,000 for those aged 75 and older who receive the 10% OAS enhancement. This calculator shows how much OAS you keep at any income level and how much is clawed back.

How much OAS is clawed back at different income levels?

The maximum monthly OAS payment for ages 65 to 74 is $743.05 for the quarter beginning January 2026, or $8,916 annually. At a net income of $100,000, the clawback is 15% of the excess over $95,323: 15% x $9,003 = $1,350. OAS received = $8,916 minus $1,350 = $7,566. At $120,000 net income, the clawback is 15% x $29,003 = $4,350. OAS received = $8,916 minus $4,350 = $4,566. The clawback is collected through quarterly OAS reductions in the following year after you file your tax return. CRA uses the prior-year net income to calculate the reduction for the current benefit period.

How the OAS recovery tax works

The threshold and recovery rate

The clawback threshold is indexed to inflation and adjusted each July when the new benefit period begins. The 2026 threshold of $95,323 reflects the 2024 income year, because CRA uses the prior two years of tax returns to set the clawback for the current July-to-June benefit period. The recovery rate is a flat 15 cents per dollar of net income above the threshold, regardless of income level. There is no bracket above the threshold; the 15% rate applies from the first dollar of excess.

Which income counts

The clawback is applied to line 23400 of the T1 return, which is “net income before adjustments” (formerly net income). This includes: employment and self-employment income; CPP and QPP retirement benefits; employer pension and annuity income; RRSP, RRIF, and LIF withdrawals; rental income net of expenses; investment income (interest, dividends at the grossed-up amount, and 50% of capital gains); the Old Age Security pension itself (OAS is included in net income even though a deduction for clawback is available at line 23500); and most other taxable income sources.

TFSA withdrawals are not included in net income and do not trigger the clawback. Principal residence sale proceeds are not included. The non-taxable portion of capital gains (50%) is not included.

OAS enhancement at age 75

Recipients who are aged 75 or older automatically receive a 10% increase in their OAS pension, as of July 2022. For January 2026, the maximum monthly OAS for recipients aged 75 or older is $817.36, or $9,808 annually. The clawback threshold remains the same ($95,323) regardless of age band, but the full clawback point shifts upward because there is more OAS to be eliminated. Full clawback occurs at approximately $153,000 net income for the 75+ group.

How CRA collects the recovery tax

CRA collects the OAS clawback in two ways. First, after filing the prior year’s tax return, if the clawback applies, a deduction appears at line 23500 (“Social benefits repayment”) reducing net income for tax purposes. CRA then calculates the repayment amount and reduces the monthly OAS payments for the following benefit year (July to June) by 1/12 of the annual repayment. Second, if net income is expected to exceed the threshold in the current year, OAS recipients can request a voluntary tax deduction from their monthly payments to avoid owing a large balance at tax time.

Verified against source

The $95,323 clawback threshold for the July 2025 to June 2026 benefit period is confirmed from the CRA Old Age Security recovery tax page (canada.ca/en/revenue-agency/services/tax/individuals/segments/old-age-security-recovery-tax). Maximum OAS amounts are confirmed from Service Canada’s OAS payment amounts page, effective January 2026. The 10% enhancement for recipients aged 75 and older was confirmed from Bill C-30 (Budget Implementation Act, 2021) and the Service Canada OAS page. These figures were verified in April 2026.

OAS clawback reference table — 2026

Net income	Clawback (15%)	Annual OAS kept (65-74)	Annual OAS kept (75+)
$95,323	$0	$8,916	$9,808
$100,000	$1,350	$7,566	$8,458
$110,000	$2,850	$6,066	$6,958
$120,000	$4,350	$4,566	$5,458
$130,000	$5,850	$3,066	$3,958
$140,000	$7,350	$1,566	$2,458
$154,753	~$8,916	$0	$892
$153,000+	$9,808+	$0	$0

Maximum OAS amounts are the quarterly maximums effective January 2026 per Service Canada. Clawback is 15% of net income above $95,323. Recipients receiving 11 or fewer months of OAS in the year should prorate accordingly.

Strategies to reduce the OAS clawback

Several legitimate tax-planning approaches reduce net income below or closer to the clawback threshold, increasing OAS retained.

RRSP contributions before OAS begins. RRSP contributions reduce net income dollar for dollar. A spouse or partner who is not subject to the clawback can continue contributing to their own RRSP or a spousal RRSP until age 71. The contributing spouse’s own net income drops, preserving OAS if the contributor is receiving it.

TFSA drawdown sequencing. TFSA withdrawals are not included in net income. Retirees with both RRIF and TFSA accounts can draw primarily from the TFSA in years when RRIF withdrawals alone would push income above the threshold. This requires modelling year-by-year income to sequence withdrawals optimally.

Pension income splitting. Couples can split up to 50% of eligible pension income (RPP benefits, RRIF withdrawals for recipients aged 65 or older) with a lower-income spouse. Income-splitting shifts dollars from the higher earner’s net income to the lower earner’s, potentially reducing the higher earner’s income below the clawback threshold.

OAS deferral. OAS can be deferred from age 65 to a maximum of age 70, increasing by 0.6% per month of deferral (7.2% per year). Deferring OAS to age 70 produces a 36% larger monthly payment. If net income is expected to decrease in a few years due to RRIF drawdown completion or reduced employment income, deferring OAS to a lower-income year can both avoid the clawback and lock in a larger benefit permanently.

Capital gains timing. Unrealised capital gains included in a single year push net income sharply upward. Spreading realisation over multiple tax years keeps annual net income below the clawback threshold. This is particularly relevant for retirees who hold non-registered investment portfolios with large accrued gains.

OAS clawback vs GIS

The OAS clawback and the Guaranteed Income Supplement (GIS) affect OAS from opposite ends of the income spectrum. The clawback reduces OAS for high-income recipients (above $95,323). GIS supplements OAS for low-income recipients (thresholds for singles are approximately $22,000 for a partial GIS and $0 non-OAS income for the full supplement). A retiree drawing large RRIF amounts may lose OAS to the clawback while a retiree with minimal income gains GIS instead. Both programs use net income as the base, so income-reduction strategies affect both simultaneously.

OAS clawback thresholds by income year

The OAS recovery tax (clawback) threshold changes every year because Canada Revenue Agency indexes it to inflation. The threshold that applies depends on the income year you are filing for, not the calendar year you receive OAS payments. The table below uses figures published by the Government of Canada on the OAS pension recovery tax page.

Income year	Minimum threshold	Full clawback (age 65-74)	Full clawback (age 75+)	OAS payment period affected
2024	$90,997	$148,451	$154,196	July 2025 – June 2026
2025	$93,454	$152,062	$157,923	July 2026 – June 2027
2026	$95,323	$154,753	$160,696	July 2027 – June 2028

The 2026 figures for the full-clawback ceilings are estimates published from January to September of the current tax year and are finalized in October 2026, after the maximum OAS pension amounts are confirmed for the full year. The minimum threshold ($95,323) is the indexed figure from the Old Age Security Act and does not change once announced.

Why the income-year alignment matters

Canada Revenue Agency uses the prior year’s net world income to determine the recovery tax that applies to OAS payments in the current period. A person receiving OAS in 2026 has their recovery tax assessed against the 2025 net world income filed on the 2025 T1 return. The threshold for that determination is $93,454 (the 2025 income year threshold), not $95,323 (the 2026 income year threshold). The 2026 income year threshold applies to OAS received from July 2027 to June 2028.

Recovery tax calculation

The recovery tax is 15% of the difference between net world income and the minimum threshold for the relevant income year. A person with 2025 net world income of $100,000 owes 15% of ($100,000 – $93,454) = 15% of $6,546 = $981.90, repaid through monthly OAS reductions from July 2026 to June 2027. The recovery tax is capped at the OAS amount received: a person whose income exceeds the full clawback ceiling for their age band repays 100% of OAS but no more.

Methodology

OAS received = max(0, annual OAS maximum minus clawback). Clawback = max(0, 0.15 x (net income minus $90,997)), capped at annual OAS maximum. Annual OAS maximum = monthly maximum x months of OAS in year. Monthly maximums: $743.05 (ages 65-74) and $817.36 (ages 75+), effective January 2026 per Service Canada. Threshold: $90,997 for July 2025 to June 2026 benefit period per CRA.

Frequently asked questions

What is the OAS clawback threshold in 2026?: The OAS recovery tax threshold for the July 2025 to June 2026 benefit period is $90,997 net income. This figure is based on 2024 net income as reported on the T1 return. The threshold is adjusted annually by CRA and published each July when the new benefit period begins. For the 2025 benefit year (July 2024 to June 2025) the threshold was $86,912.
How is the OAS clawback calculated?: The OAS recovery tax equals 15% of net income above the threshold. For 2026: recovery tax = 0.15 x (net income minus $90,997), to a maximum of the total OAS received. If net income is $110,000, the clawback is 0.15 x ($110,000 minus $90,997) = 0.15 x $19,003 = $2,850. This amount is deducted from OAS payments in the following benefit year.
What net income triggers full OAS elimination?: For recipients aged 65 to 74, full elimination occurs when the clawback equals the maximum annual OAS of approximately $8,916 (January 2026 quarterly maximum annualised). At 15%, this occurs at $90,997 + ($8,916 / 0.15) = approximately $150,437 net income. For recipients aged 75 and older receiving the 10% enhancement ($9,808 annually), full elimination occurs at approximately $90,997 + ($9,808 / 0.15) = approximately $156,317.
Does the OAS clawback apply to TFSA withdrawals?: No. TFSA withdrawals are not included in net income and do not trigger the OAS clawback. This makes TFSA accounts particularly valuable for retirees at risk of the clawback. Drawing living expenses from the TFSA rather than an RRIF or non-registered account can keep net income below the threshold.
Can pension income splitting reduce the OAS clawback?: Yes. Eligible pension income splitting shifts up to 50% of qualifying pension income from the higher-income spouse to the lower-income spouse, reducing the higher-income spouse's net income for clawback purposes. Eligible income for splitting includes RPP pension benefits and RRIF withdrawals for recipients aged 65 or older. CPP benefits are split separately through the CPP credit-splitting mechanism and do not use the pension income splitting election.
Does deferring OAS reduce the clawback?: Deferring OAS reduces clawback indirectly in two ways. First, if net income is expected to drop in a future year (for example, after completing RRIF minimum withdrawals or reducing employment income), receiving OAS in that lower-income year means less or no clawback. Second, the deferred OAS amount is larger (0.6% per month of deferral), so the break-even with early receipt must be weighed against the clawback reduction benefit. The OAS deferral decision should model net income year by year.
Does the OAS clawback affect QPP or CPP benefits?: No. The OAS recovery tax applies only to OAS payments. CPP and QPP retirement benefits are not subject to clawback, though they are included in net income and contribute to the clawback calculation for OAS. There is no equivalent clawback mechanism for CPP or QPP.
Is the OAS clawback refunded if income was lower than expected?: Yes. If income in the benefit year turns out lower than in the prior year that CRA used to calculate the withholding reduction, the overpaid clawback is refunded through the T1 return. Line 23500 of the return reconciles the recovery tax. Retirees whose income varies significantly year to year should file their return promptly and may request reduced withholding from OAS if they expect lower income than the prior year.
Does OAS clawback apply to the Allowance?: No. The Allowance (paid to spouses and common-law partners of GIS recipients, aged 60 to 64) and the Allowance for Survivor are not subject to the OAS recovery tax. The clawback applies only to the OAS pension received by those aged 65 and older. However, the income of the Allowance recipient's household affects GIS eligibility for the OAS-receiving spouse.
Is OAS clawback repayment tax deductible?: Yes. The amount repaid under the OAS recovery tax is deducted at line 23500 of the T1 return as 'Social benefits repayment,' reducing net income for that year. This creates a partial offset: the deduction reduces federal and provincial income tax payable on the clawback amount, though it does not fully offset the economic cost of the clawback.