Worked example (2026, Ontario)
Lives in Ontario, aged 65 or older, $8,900 of OAS, $14,000 of CPP, a $85,000 pension. The calculator above opens with these figures; change them to see your own return, line by line like the T1.
| Line | T1 return | Amount |
|---|---|---|
| 11300 | Old Age Security pension | $8,900.00 |
| 11400 | CPP or QPP benefits | $14,000.00 |
| 11500 | Other pensions and superannuation | $85,000.00 |
| 15000 | Total income | $107,900.00 |
| 23500 | Social benefits repayment (OAS recovery tax) | −$1,886.55 |
| 23600 | Net income | $106,013.45 |
| 26000 | Taxable income | $106,013.45 |
| Federal tax 14% on $58,523 | $8,193.22 | |
| Federal tax 20.5% on $47,490 | $9,735.54 | |
| 40400 | Federal tax on taxable income | $17,928.76 |
| 30000 | Basic personal amount | $16,452.00 |
| 30100 | Age amount | $270.78 |
| 31400 | Pension income amount | $2,000.00 |
| 33800 | Non-refundable credits: 14% of $18,723 | −$2,621.19 |
| 42000 | Net federal tax | $15,307.57 |
| Provincial tax 5.05% on $53,891 | $2,721.50 | |
| Provincial tax 9.15% on $52,122 | $4,769.20 | |
| Provincial tax on taxable income | $7,490.70 | |
| Provincial credits: 5.05% of $14,785 | −$746.64 | |
| Ontario surtax | $185.21 | |
| Ontario Health Premium | $750.00 | |
| 42800 | Provincial or territorial tax | $7,679.27 |
| 42000 | Net federal tax | $15,307.57 |
| 42200 | Social benefits repayment | $1,886.55 |
| 42800 | Provincial or territorial tax | $7,679.27 |
| 43500 | Total payable | $24,873.39 |
| 43700 | Total income tax deducted | $0.00 |
| 48200 | Total credits | $0.00 |
| 48500 | Balance owing | $24,873.39 |
OAS recovery tax by net income (2026)
| Net income before adjustments | OAS repaid | OAS kept (of $8,900) |
|---|---|---|
| $90,000 | $0.00 | $8,900.00 |
| $100,000 | $701.55 | $8,198.45 |
| $110,000 | $2,201.55 | $6,698.45 |
| $125,000 | $4,451.55 | $4,448.45 |
| $140,000 | $6,701.55 | $2,198.45 |
| $160,000 | $8,900.00 | $0.00 |
The threshold is $95,323. Pension splitting with a spouse, RRSP or FHSA deductions and taking capital gains in a lower-income year can keep net income below it.
How the Canadian return is calculated
- Total income (line 15000). Employment income, pensions, OAS, CPP and EI benefits, interest, the grossed-up amount of dividends, half of capital gains, rental and business income.
- Net income (line 23600). Minus RRSP and FHSA deductions, union dues, child care expenses and the enhanced part of CPP (lines 22200 and 22215), and minus any OAS recovery tax.
- Federal tax. Tax on taxable income at 14%, 20.5%, 26%, 29%, 33%, minus non-refundable credits at 14% (basic personal amount up to $16,452, CPP, EI, the Canada employment amount, pension, age, disability, tuition and medical), the donations credit, the top-up tax credit and the dividend tax credit.
- Ontario tax (Form 428). Provincial brackets and credits at 5.05%, the provincial dividend tax credit, the Ontario surtax, tax reduction, LIFT credit and Health Premium.
- Refund or balance owing (lines 48400 and 48500). Total payable (federal and provincial tax, CPP on self-employment, OAS recovery) minus tax deducted, CPP and EI overpayments, the Canada workers benefit and instalments.
Key 2026 figures
Federal tax brackets 2026
| Taxable income | Rate |
|---|---|
| $0 to $58,523 | 14% |
| $58,523 to $117,045 | 20.5% |
| $117,045 to $181,440 | 26% |
| $181,440 to $258,482 | 29% |
| Over $258,482 | 33% |
Federal amounts 2026
| Item | Amount |
|---|---|
| Basic personal amount | $16,452 (falls to $14,829 between $181,440 and $258,482 of net income) |
| Credit rate (lowest bracket) | 14% |
| Canada employment amount | $1,501 |
| Age amount (65+) | $9,208, reduced by 15% of net income over $46,432 |
| CPP | 5.95% of earnings from $3,500 to $74,600, plus 4% CPP2 up to $85,000 |
| EI premium | 1.63% on insurable earnings up to $68,900 (Quebec 1.3%) |
| RRSP dollar limit | $33,810 |
| OAS recovery threshold | $95,323 |
| Medical expense threshold | 3% of net income or $2,890, whichever is less |
| Dividend gross-up / federal credit | Eligible 38% / 15.0198%; other 15% / 9.0301% |
Ontario brackets 2026
| Taxable income | Rate |
|---|---|
| $0 to $53,891 | 5.05% |
| $53,891 to $107,785 | 9.15% |
| $107,785 to $150,000 | 11.16% |
| $150,000 to $220,000 | 12.16% |
| Over $220,000 | 13.16% |
Basic personal amount $12,989.
Official source: CRA: federal income tax rates (2025), CRA: current-year federal and provincial rates, CRA: indexation of personal income tax and benefit amounts, CRA: T4127 payroll deductions formulas (January 2026), CRA: CPP contribution rates, maximums and exemptions, CRA: EI premium rates and maximums. Rates checked on Oct 29, 2026.
Questions people ask
How is the OAS clawback collected?
It is calculated on your return, and the CRA then withholds it from your monthly OAS payments from July of the following year to June.
Can pension splitting reduce the clawback?
Yes. Moving up to half of eligible pension income to a lower-income spouse lowers your net income; this calculator does not model the split.
Is this the same as the CRA’s calculation?
It follows the T1 return and Form 428 step by step with the CRA’s rates for the year: income, deductions, net and taxable income, federal tax and credits (including the 2025-2030 top-up tax credit), provincial tax and reductions, then refundable credits. It assumes a single filer who lived in one province all year and leaves out spouse and dependant amounts, pension splitting, loss and tuition carry-forwards, foreign income, the alternative minimum tax and provincial tuition credits.
Which tax year should I choose?
2025 is the return you filed by April 30, 2026. 2026 is the return due by April 30, 2027 (June 15, 2027 if you or your spouse are self-employed, with any balance still due April 30).
Reviewed by Soufyane S.. Last updated Oct 29, 2026. How we check numbers
Estimates for information only, not tax, legal or financial advice. Check with an adviser or the official tax authority.