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OAS Deferral Calculator

"Should you delay Old Age Security to age 70 for a 36% increase? Find your personal breakeven point and account for clawbacks."

Updated: March 7, 2026•Source: CRA / Service Canada

Should You Delay OAS to Age 70?

For every month you delay Old Age Security (OAS) beyond age 65, your payment increases by 0.6% — up to a massive 36% permanent increase if you wait until age 70. But if your income is high, clawbacks may eat into your benefits. This engine helps you find the sweet spot.

📝 How to use

  • 1Enter your expected annual retirement income (excluding OAS) to see if clawbacks apply.
  • 2Adjust your life expectancy to see how long you need to live for delaying to pay off.
  • 3Compare cumulative OAS by start age to find your optimal strategy.

🎯 Real-World Scenarios

Longevity Protection

OAS is inflation-indexed and guaranteed for life. Delaying creates a bigger "floor" of guaranteed income in your 80s and 90s.

The Clawback Trap

High earners (income over $93k) lose 15 cents of OAS for every extra dollar of income.

Frequently Asked Questions

How much does OAS increase if I delay to 70?▼
OAS increases by 0.6% for each month you delay past 65, up to a maximum of 36% if you wait until age 70. That means your monthly payment could be over $1,000 instead of ~$750.
What is the OAS clawback threshold for 2026?▼
The OAS clawback (Recovery Tax) kicks in at approximately $93,454 of net income. Above this, you lose 15 cents of OAS for every dollar of income until it is fully clawed back.
Can I avoid the OAS clawback?▼
Yes, strategies include income splitting with a spouse, using TFSAs instead of RRSPs, timing RRSP withdrawals, and deferring OAS to reduce the years you are subject to clawback.
$
CAD

Annual income excluding OAS.

90 yrs

Optimal Start Age

Age 70

Lifetime OAS: $257,787

What This Calculator Solves

This engine compares the lifetime value of starting Old Age Security (OAS) at 65 versus deferring it until age 70. Since OAS increases by 36% if delayed to 70, it serves as a powerful inflation-protected life annuity. This tool quantifies exactly how much extra income you gain per month and where your 'breakeven' age lies.

OAS Clawback: The '75% Marginal Tax Rate' Recovery

The OAS Recovery Tax (Clawback) is one of the most punitive taxes for Canadian retirees. It applies a 15% 'tax' on every dollar of income over approximately $90,000, on top of your existing 40-50% marginal tax rate.

Delaying as a Shield: By delaying OAS until age 70, you increase your future guaranteed income floor. While this might seem counter-intuitive if you are high-income, it allows you 5 extra years (from 65 to 70) to 'melt down' your RRSP or sell taxable assets without having that income trigger an immediate OAS clawback.

Strategic Decumulation: For high-net-worth retirees, delaying OAS isn't just about the 36% bonus—it's about clearing the 'income runway' in your late 60s to move money into your TFSA or pay down future liabilities at much lower effective tax rates. It's a key pillar of a sophisticated tax-location strategy.

Methodology & Data Sources

We calculate the monthly OAS benefit for each start age from 65 to 70 using the current maximum monthly benefit and the 0.6% monthly deferral factor. We then estimate the annual clawback based on your entered 'Retirement Income'. Finally, we evaluate your cumulative net benefits (after clawback) year-by-year until your specified 'Life Expectancy'.

* Calculations are for educational purposes only.

Frequently Asked Questions

How much does OAS increase if I delay to 70?
OAS increases by 0.6% for each month you delay past 65, up to a maximum of 36% if you wait until age 70. That means your monthly payment could be over $1,000 instead of ~$750.
What is the OAS clawback threshold for 2026?
The OAS clawback (Recovery Tax) kicks in at approximately $93,454 of net income. Above this, you lose 15 cents of OAS for every dollar of income until it is fully clawed back.
Can I avoid the OAS clawback?
Yes, strategies include income splitting with a spouse, using TFSAs instead of RRSPs, timing RRSP withdrawals, and deferring OAS to reduce the years you are subject to clawback.
What is the 'OAS Recovery Tax' (Clawback)?
If your net world income exceeds a certain threshold ($90,997 for the 2024 tax year), you must repay 15% of the excess income, up to the total amount of OAS received. This is known as the clawback. If your income is very high, your OAS may be reduced to zero.
Does everyone get the same OAS amount?
No. The amount depends on how long you have lived in Canada after age 18. To get the full OAS pension, you generally need to have lived in Canada for at least 40 years after turning 18. If you have lived here for less than 40 years, you may receive a partial pension.
Should I delay OAS if I am low income?
Generally, no. If you are low income, you may be eligible for the Guaranteed Income Supplement (GIS). However, you cannot receive GIS unless you are also receiving OAS. Delaying OAS means you also delay GIS, which is usually not financially optimal for low-income seniors.
Is OAS taxable?
Yes, OAS is considered taxable income. Unlike the TFSA, OAS payments are subject to federal and provincial income tax at your marginal rate.

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