OAS just went up — and the clawback math reset with it
The July 2026 quarter brings a 1.2% OAS raise and a new recovery-tax year. Here's the new monthly maximums, the income threshold that matters, and what retirees can still do about it.
Old Age Security is re-indexed to inflation every quarter, not once a year. The July-to-September 2026 adjustment is a 1.2% increase — the largest bump of 2026 so far, after April's near-zero 0.1%. The first payment at the new rate lands July 29, 2026.
The new monthly maximums
- $751.97/month if you're 65 to 74 (up from $743.05).
- $827.17/month if you're 75 or older (up from $817.36) — the 75+ rate includes the permanent 10% top-up introduced in 2022.
Quarterly indexation only moves one way: if CPI falls, payments stay flat. So the July figure is your floor for the rest of the quarter.
OAS is not automatic money for life at any income. Above a set threshold, the recovery tax — the clawback — takes back 15 cents of every extra dollar.
July also resets the clawback year
Two things happen to the clawback each July:
- The amount withheld from your monthly payments is recalculated from the tax return you just filed — from July 2026, that's your 2025 income.
- For income you earn in 2026, the recovery-tax threshold rises to $95,323 of net world income. Below that, you keep every OAS dollar.
Above the threshold, the math is mechanical: 15% of every dollar over $95,323 comes back off your OAS. A retiree with $110,000 of net income who collects about $9,024 of OAS a year would repay roughly $2,202 and keep about $6,822. The full pension is gone at roughly $155,000 for a 65-to-74-year-old.
That's an income-specific number — run your own with the OAS clawback calculator.
What you can still do about it
The clawback runs on net income, so anything that lowers the line lowers the clawback:
- Draw from your TFSA. TFSA withdrawals don't count as income; RRSP and RRIF withdrawals do.
- Split eligible pension income with a lower-income spouse to move dollars under the threshold.
- Melt down the RRSP early. Drawing it before mandatory RRIF minimums kick in at 72 can smooth income below the threshold in your OAS years — the RRSP meltdown calculator shows what that schedule looks like.
- Time capital gains. A one-year spike from selling a property or portfolio can trigger a clawback for that year even if your usual income is well below the line.
The takeaway
A 1.2% raise is about $9 a month — nice, not life-changing. The bigger July event is the reset of the clawback math: a new threshold, and withholding now keyed to your 2025 return. If your net income sits anywhere near $95,000, where your retirement dollars come from — TFSA, RRIF, pension, capital gains — now matters more than how many of them there are.
Clawback estimate delivered by Metrestick. Underlying data: CRA 2026 tax parameters with OAS/GIS/CPP figures (Open Government Licence – Canada), 2026.