OAS Clawback Calculator
Calculate how much of your Old Age Security will be clawed back based on your income.
tl;dr
The OAS clawback (recovery tax) reduces your benefit once net income passes the annual threshold ($95,323 in 2026), and in the clawback zone it acts like an extra layer on top of your marginal tax rate. Seniors 75+ receive a higher base OAS, so they reach full clawback at a higher income. OAS is also prorated if you have fewer than 40 years of Canadian residency after age 18 (a minimum of 10 years is required for eligibility).
OAS Clawback Calculator
Enter your income details to calculate your OAS clawback.
The OAS recovery tax claws back 15 cents per dollar of net income above the threshold.
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Why OAS Clawback Matters
Old Age Security is a significant source of retirement income for most Canadians, but the recovery tax can reduce or eliminate it for higher-income retirees. In the clawback zone, the recovery acts like an extra layer on top of your regular marginal rate, making it one of the most heavily taxed income ranges in retirement. Understanding it is critical for retirement income planning: strategies that can minimize or avoid the clawback include delaying OAS, drawing from a TFSA instead of an RRSP, income splitting with a spouse, and planning RRIF withdrawals. Proper planning can preserve thousands of dollars of OAS each year.
What Counts as Net Income for OAS Clawback?
OAS clawback uses Line 23400 (net income before adjustments) from your tax return. Understanding what's included helps you plan withdrawals strategically.
Counts Toward Clawback
- • Employment income
- • CPP/QPP benefits
- • RRSP/RRIF withdrawals
- • Pension income (DB, DC)
- • Investment income (interest, dividends, capital gains)
- • Rental income
- • OAS itself (yes, it's circular)
Doesn't Trigger Clawback
- • TFSA withdrawals
- • GIS payments
- • Inheritances
- • Gifts received
- • Life insurance payouts
- • Lottery winnings
Planning tip: Prioritizing TFSA withdrawals over RRIF withdrawals in retirement can help you stay below the clawback threshold.
How OAS Clawback Is Calculated
The OAS clawback is based on your net world income:
- 1. Determine Net Income: Your net income (line 23600) includes employment, pension, RRIF withdrawals, CPP, dividends, the taxable portion of capital gains, and foreign income. It excludes TFSA withdrawals and GIS.
- 2. Compare to the Threshold: The recovery tax begins once net income passes the annual OAS threshold (indexed each year). Below it, there is no clawback. The calculator uses the current threshold.
- 3. Calculate the Excess: The clawback applies to the income above the threshold.
- 4. Apply the Recovery Rate: A fixed recovery rate on the excess reduces your OAS. The calculator applies the current rate.
- 5. Full Clawback Point: Above a higher income level, OAS is fully recovered. The calculator shows where your income lands.
- 6. How It's Collected: The clawback is recovered through reduced monthly OAS payments the following year.
OAS Clawback Thresholds
| Income Year | Threshold | Full Clawback (65-74) | Full Clawback (75+) |
|---|---|---|---|
| 2024 | $90,997 | $148,451 | $154,196 |
| 2025 | $93,454 | $152,062 | $157,923 |
| 2026* | $95,323 | $154,708 | $160,647 |
* 2026 figures may be CRA estimates until final amounts are confirmed in October.
Common Questions
Can I avoid OAS clawback by delaying OAS?
Delaying doesn't avoid the clawback directly, but it raises your benefit for each year you wait, which can leave you ahead even with some clawback. You can also spend down RRSPs before starting OAS to lower income in your OAS years.
Do TFSA withdrawals count toward OAS clawback?
No — TFSA withdrawals aren't included in net income, so they don't trigger the clawback. That makes TFSAs especially valuable for retirees near the threshold, since the same withdrawal from an RRSP would increase the clawback.
Can I split income with my spouse to reduce clawback?
Yes. Pension income splitting lets you move eligible pension income to a spouse, which can keep one or both of you below the threshold. CPP can also be shared. Done well, this preserves OAS and lowers your household's overall tax.
What happens if I'm just over the threshold?
Even a dollar over the threshold starts the clawback, creating a cliff effect — earning a bit more can cost OAS on top of the tax on that income. That's why planning withdrawals around the threshold matters.
Is OAS clawback permanent?
No — it's recalculated annually on the previous year's income. If your income drops below the threshold in a later year, your full OAS is restored. It's really an annual income test.
Strategies to Minimize OAS Clawback
- ✓Maximize TFSA Usage: Prioritize TFSA savings and withdrawals in retirement, since they don't count toward the clawback threshold.
- ✓Plan RRSP/RRIF Withdrawals: Drawing from RRSPs before OAS starts can reduce mandatory RRIF withdrawals later that would otherwise trigger the clawback.
- ✓Delay OAS: If you have other income, delaying OAS raises your benefit and can offset future clawback.
- ✓Income Split With a Spouse: Use pension income splitting to balance income and keep both spouses below the threshold.
- ✓Consider CPP Sharing: Sharing CPP can redistribute income between spouses for tax purposes.
- ✓Plan Capital Gains Timing: Since the taxable portion of a gain counts as income, time large sales to avoid pushing into clawback territory.