Short Answer
You can earn any amount and still receive OAS — there is no hard income limit. However, once your net income exceeds roughly $90,997 (2026 threshold, indexed annually), OAS begins clawing back at 15 cents per dollar of excess income.
OAS is completely clawed back at around $148,000–$151,000 of net income.
2026 OAS Clawback Thresholds
| Component | Amount |
|---|---|
| Clawback starts (net income) | ~$90,997 |
| Clawback rate | 15% of income above threshold |
| Full clawback (OAS = $0) | ~$148,000–$151,000 |
| Maximum monthly OAS (age 65–74) | ~$727 |
| Maximum monthly OAS (age 75+) | ~$800 |
The threshold is indexed annually by CRA. Check CRA or your NOA for the confirmed figure for the tax year in question.
How the Clawback Is Calculated
Formula: Clawback = (Net Income − $90,997) × 15%
Example A: Income just above threshold
| Item | Amount |
|---|---|
| Net income | $100,000 |
| Threshold | $90,997 |
| Excess income | $9,003 |
| OAS clawback | $9,003 × 15% = $1,350/year |
| Monthly OAS reduction | $112.50 |
| Monthly OAS remaining (~$727 max) | ~$614.50 |
Example B: High-income retiree
| Item | Amount |
|---|---|
| Net income | $130,000 |
| Threshold | $90,997 |
| Excess income | $39,003 |
| OAS clawback | $39,003 × 15% = $5,850/year |
| Monthly OAS reduction | $487.50 |
| Monthly OAS remaining | ~$239.50 |
Example C: Well below threshold
| Item | Amount |
|---|---|
| Net income | $75,000 |
| Clawback | None |
| OAS retained | Full amount |
What Counts as Net Income (and What Does Not)
| Income type | Counts toward clawback threshold? |
|---|---|
| Employment income | Yes |
| CPP retirement pension | Yes |
| Company/DB pension | Yes |
| RRSP withdrawals | Yes |
| RRIF withdrawals | Yes |
| Investment income (interest, dividends, capital gains) | Yes |
| Self-employment income | Yes |
| Rental income (net) | Yes |
| TFSA withdrawals | No — not income |
| GIS | No — excluded from clawback calc |
| Lottery windfalls (tax-exempt) | No |
TFSA withdrawals are the single most effective tool for retirees trying to stay under the OAS clawback threshold — they provide cash flow with no impact on net income.
How OAS Clawback Is Collected
| Method | Detail |
|---|---|
| CRA calculates your clawback liability on your tax return | Based on net income from line 23600 |
| If clawback is expected, CRA reduces future OAS payments in advance | Through Monthly Recovery Tax withholding |
| You file taxes and true up any balance | Excess repaid or refunded |
CRA typically sends a letter in advance if they expect a clawback in the upcoming year, adjusting OAS payments proactively. This is why some retirees see their OAS payment drop partway through the year.
Strategies to Protect OAS
| Strategy | How it helps |
|---|---|
| TFSA withdrawals instead of RRSP/RRIF | Zero impact on net income |
| Pension income splitting with spouse | Shifts income to lower net income for clawback purposes |
| RRSP meltdown before 65 | Draws down RRSP at lower marginal rate, reduces large RRIF withdrawals later |
| Delaying OAS to age 70 | +36% higher monthly amount; better if high-income years are 65–70 |
| Timing capital gains | Spread large disposals across tax years to stay below threshold |
| Corporate structure | Retiring allowance or corporate income management (complex — needs advisor) |
Should You Defer OAS?
Deferring OAS from 65 to 70 increases your monthly benefit by up to 36%. This can make sense if:
- Your income is high in your early retirement years (e.g., RRSP withdrawals, continuing to work)
- You expect lower income from 70+ due to stopped RRIF minimums or lower pensions
- You are in good health and expect a long retirement
See the OAS deferral guide for the full break-even analysis.
OAS vs. GIS: They Work Differently
| Feature | OAS | GIS |
|---|---|---|
| Income-tested? | Yes — high income | Yes — low income |
| Threshold | ~$90,997 | ~$0 of other income |
| Clawback rate | 15% | 50% |
| Employment exemption | None | $5,000 fully exempt |
| TFSA treatment | No impact | No impact |
OAS serves high earners with a high-income clawback. GIS serves low-income seniors with a low-income cap. They work in opposite directions on the income spectrum.