How this calculator works
Every dollar of net income above the year's threshold costs 15 cents of OAS, up to the full amount you were paid that year — CRA calls this the Recovery Tax; almost everyone else calls it the clawback. This calculator takes your net income before adjustments, your age band, your province and any months you deferred OAS past 65, works out the maximum OAS you're entitled to for the year, applies the 15% repayment above the threshold (capped so you never repay more than you received), and shows what income tax the OAS you keep adds to your return.
OAS kept = OAS for the year − Recovery tax
Taxable income = net income − Recovery tax (the repayment is deducted at line 23500)
Income tax on OAS kept = Tax(taxable income) − Tax(taxable income − OAS kept)
The threshold moves every year — and the clock runs a year behind
The recovery tax is assessed using the same year's income and threshold: your 2026 income is compared against the 2026 threshold on your 2026 return. What actually changes from one calendar year to the next is when the money leaves your OAS cheque. Service Canada estimates a full year's repayment from your most recently assessed return, then withholds it in equal monthly instalments starting the following July and running through June of the year after — so the 2026 income you enter here funds the withholding period that starts in July 2027, about six months after the year ends. The amount already withheld in a year appears in box 22 of that year's T4A(OAS) slip and is reconciled on line 43700 of your return; if your income drops the year after a high-income year, you can end up temporarily over-withheld until the next return catches up, which Form T1213(OAS) (below) exists to shorten.
| Income year | Minimum threshold | Governs withholding | Status |
|---|---|---|---|
| 2024 | $90,997 | Jul 2025 – Jun 2026 | Fully withheld |
| 2025 | $93,454 | Jul 2026 – Jun 2027 | Currently being withheld |
| 2026 | $95,323 | Jul 2027 – Jun 2028 | This calculator's year — not yet withheld |
The threshold is indexed to inflation each year. This calculator always uses the 2026 income year's figures ($95,323 minimum threshold); if you're checking against what's actually coming off a cheque today, that's the 2025-income, $93,454 line instead — the mechanics are identical, only the two numbers differ.
Deferral and the age-75 increase both change the OAS at stake — before any clawback
Two things change your maximum OAS before the 15% rate ever applies. Deferring the start of your OAS past 65 adds 0.6% for every month you wait, up to a maximum 36% increase at age 70 (there's no benefit to waiting past 70). Separately, and permanently, OAS itself pays about 10% more from the month after you turn 75 — $827.17/month for July–September 2026, against $751.97/month for ages 65–74. This calculator applies your deferral to the 65–74 rate first, then, if you're in the 75-and-over band, applies that same roughly-10% step on top — so a deferred pension carries its full deferral bonus into the higher band rather than losing it.
A repayment, not a loss of eligibility
It's worth separating what actually happens from what "clawback" sounds like it means. Passing the threshold doesn't disqualify you from OAS, reduce your future entitlement, or flag your file — it triggers a straightforward repayment calculated on that year's tax return, exactly like a benefit that phases out with income anywhere else in the tax system. The repayment is capped at the full OAS you were paid, so it can never turn into a bill larger than the pension itself, and it's deducted in arriving at your net income for the year (T1 line 23500), so the repaid amount is never separately income-taxed on top of being repaid.
Reducing the withholding before it happens: Form T1213(OAS)
If you can see, before your return is filed, that this year's income will land well below what triggered your current withholding — retirement, selling a rental property, a one-time payout the year before — Form T1213(OAS), Request to Reduce Old Age Security Recovery Tax at Source, lets you ask the CRA in writing (the completed form goes to the CRA, not Service Canada) to have the amount withheld reduced, rather than waiting to be reconciled at tax time.
Worked example — age 68, Ontario, $110,000
An Ontario resident, age 68 (the 65–74 band), started OAS at 65 with no deferral, and reports net income before adjustments of $110,000 for 2026.
- Maximum annual OAS: $751.97 × 12 = $9,023.64 (no deferral, no age-75 step-up yet).
- Excess over the 2026 threshold: $110,000 − $95,323 = $14,677.00.
- Recovery tax: 15% × $14,677.00 = $2,201.55 — well under the $9,023.64 cap, so it isn't capped.
- OAS kept: $9,023.64 − $2,201.55 = $6,822.09.
- Taxable income after the repayment: the $2,201.55 repaid is deducted at line 23500, so $110,000 − $2,201.55 = $107,798.45 is what actually gets taxed.
- Income tax on that $6,822.09, as the top slice of the $107,798.45 (from $100,976.36 to $107,798.45), using the same federal-and-provincial engine as our take-home pay calculator: tax on $107,798.45 ($23,975.83) minus tax on $100,976.36 ($21,827.91) = $2,147.92.
- After both: $6,822.09 − $2,147.92 = $4,674.17 is what the OAS actually adds to this year's spending money, out of $9,023.64 originally paid.
Figures above carry full precision from the same functions the calculator runs; only the write-up rounds for readability.
What this calculator doesn't model
Beyond the federal age amount and any provincial age or pension income credit — deliberately left out so the "income tax on OAS kept" row shows a clean marginal-tax-rate slice rather than a blend with an income-tested credit that phases out on its own schedule — this tool assumes the full 40-year OAS residency pension (a partial pension would scale every OAS figure down proportionally, before any clawback applies), skips GIS, the Allowance, and any spousal income or pension splitting, and doesn't apply the two narrow UCCB/RDSP adjustments CRA makes to line 23400 before comparing it to the threshold (irrelevant for almost anyone of OAS age). The "income at which OAS reaches zero" is this calculator's own threshold-plus-OAS-over-15% derivation, not copied from canada.ca's own published maximum thresholds, which reflect the actual quarter-by-quarter OAS paid across a specific 12-month period rather than one quarter's rate held flat for a year — at zero deferral this calculator's derived zero point comes to $155,480.60 for the 65–74 band and $161,496.60 for 75-and-over, against canada.ca's own (estimated, pending the October–December 2026 OAS rate) $155,109 and $161,088 for the same 2026 income year — close, not identical. Finally, this calculator computes the repayment mechanics exactly (same year's income against that year's threshold) but doesn't simulate the one-year lag in when that repayment is actually withheld — see "The threshold moves every year" above for what that lag means in practice.
FAQ
What is the OAS recovery tax (clawback), and is it different from losing my OAS?
It's a repayment, not a loss of eligibility. Once your net income for a year passes that year's threshold, you repay 15 cents of every dollar over the line, capped at the full OAS you were paid that year — you never repay more than you received, and your eligibility for OAS itself is never affected. The word "clawback" makes it sound like a benefit is being taken away from someone who qualified for it; what's actually happening is a repayment calculated on your tax return, the same mechanism CRA uses for other income-tested benefits that phase out at higher income.
Why does the threshold in this calculator look different from what's coming off my OAS payments right now?
Because the recovery tax runs a year behind the income that triggers it. What's withheld from your OAS cheques today is based on the net income on your most recently filed tax return, using that return's own threshold — not this year's income or this year's threshold. This calculator is fixed to the 2026 income year and its $95,323 threshold, so it shows what will be assessed on the 2026 return; the actual withholding for that assessment then starts in July 2027, once the return is filed and processed. The table earlier on this page lines up each recent income year with the payment period its threshold governs.
What exactly counts as the "net income" this calculator asks for?
It starts from net income before adjustments — line 23400 of your T1 return — which already includes your OAS itself, alongside CPP, RRSP/RRIF withdrawals, employment income, investment income and most other sources. CRA then makes two narrow adjustments before comparing it to the threshold: it subtracts any Universal Child Care Benefit and RDSP income you received that year, and adds back any UCCB or RDSP amount you had to repay. This calculator doesn't apply those two specific adjustments — for almost everyone past OAS age they don't apply anyway — see "What this calculator doesn't model" below.
Can I do anything before the recovery tax is actually withheld?
Two different things help two different situations. If this year's income will clearly come in below the amount CRA used to estimate your withholding — you retired, sold a rental property in a one-off year, or otherwise had unusually high prior-year income — Form T1213(OAS), Request to Reduce Old Age Security Recovery Tax at Source, lets you ask the CRA in writing to have what's withheld reduced, before your return is even filed. Separately, if you want to reduce the actual repayment a future year will owe rather than just the estimate withheld against it, contributing to an RRSP (if you have room) or otherwise lowering that year's net income before adjustments brings you closer to, or under, that year's threshold — this calculator's "deduction needed" figure shows exactly how much.
Does deferring OAS past 65, or turning 75, change how much I could lose to the clawback?
It changes how much OAS is at risk, not the 15% rate or the threshold itself. Deferring OAS past 65 increases your pension by 0.6% for every month you wait, up to 36% at age 70 — a larger pension gives the recovery tax more room to claw back if your income is high enough, but it also means more OAS survives at incomes below the point where the whole pension is repaid. Turning 75 raises the maximum OAS by roughly 10% permanently, for the same reason: a bigger pension changes both the OAS you could keep and, at high income, the dollar amount repaid — the 15% rate and the underlying income threshold don't change with either deferral or age band.
This page is general information based on published 2026 federal figures, not tax or financial advice. Your own return depends on details this calculator doesn't see — talk to a licensed accountant or Service Canada about your own situation.