CRA to Retirees: 5 Ways to Avoid the 15% OAS Clawback

Author: External Author | | Categories: Accountant , Corporate Financial Statements , Financial Statement Preparation

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Retirees in Canada receive a significant amount of retirement income through the Old Age Security (OAS). The maximum monthly payment amount is $615.37 (January to March 2021), so a typical retiree could receive $7,384.44 annually in the course of the retirement years.

Since the Canada Revenue Agency (CRA) considers the benefit as taxable income, retirees have to contend with a recovery tax. The 15% OAS clawback impacts a retiree’s income. It reduces the benefit amount, especially of retirees in higher income brackets. Hence, it’s a yearly battle with the tax agency to avoid the dreaded clawback.

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Original Article Source Credits:   The Motley Fool , https://www.fool.ca/

Article Written By:  Christopher Liew, CFA 

Original Article Posted on:   March 22, 2021

Link to Original Article:  https://www.fool.ca/2021/03/22/cra-to-retirees-5-ways-to-avoid-the-15-oas-clawback/



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