Your browser version is outdated. We recommend that you update your browser to the latest version.

Seniors Beware of Clawbacks

Posted 2/6/2019

The three (3) main clawbacks affecting seniors are:

  • Guaranteed Income Supplement
    GIS is a supplement of up to $7,608 of tax-free income paid to seniors with an income under $18,240 Individual Income and $24,096 combined income if your spouse receives the Old Age Security payment .  For every $2 of taxable income, the GIS is reduced by $1.
  • Age Deduction Amount for seniors over 65
    If they were 65 years of age or older on December 31 of the taxation year. The maximum amount you can claim in 2018 is $7,333; in 2019, it's $7,494.  If your net income is more than $36,430, but less than $84,597, the deduction 
    is reduced by 15%.
  • Old Age Security (OAS) clawback
    If your 2018 net income is greater than $75,910 ($77,580 for 2019) you will have to repay 15% of the excess over this amount, to a maximum of the total amount of OAS received.

Cashing in RRSP's can affect all of these.  It is important that you talk to a tax professional before you cash in an RRSP.