CPP and OAS in 2026: How Much Will You Receive in Retirement?
CPP and OAS are the backbone of retirement income for most Canadians — but how much you actually receive depends on when you start, how long you worked, and how much you earned. Here's what the numbers look like in 2026 and how to plan around them.
CPP: how your benefit is calculated
The Canada Pension Plan is a mandatory contributory program. Every year you work and earn employment or self-employment income, you and your employer each contribute a percentage of your earnings (above the basic exemption of $3,500) up to the Year's Maximum Pensionable Earnings (YMPE). In 2026, the YMPE is $74,600 and the employee/employer contribution rate is 5.95% — a maximum contribution of $4,230.45 each.
Your CPP retirement pension is based on your average earnings over your contributory period, how many years you contributed, and the age at which you start. The calculation drops your lowest-earning years (up to 8 years) to avoid penalizing career breaks, parental leave, or periods of disability.
CPP payment amounts in 2026
| Start age | Monthly amount (if taking at this age) | Key detail |
|---|---|---|
| 60 (early) | ~$964.90/month maximum | 36% reduction from age-65 amount; permanent |
| 65 (standard) | $1,507.65/month maximum | Full standard benefit; most common start age |
| 70 (delayed) | ~$2,140.86/month maximum | 42% increase from age-65 amount; permanent |
CPP Enhancement (CPP2): what changed in recent years
Since 2019, CPP has been enhanced through a second, higher contribution tier. Workers who earn above the original YMPE (up to a second ceiling of $85,000 in 2026) contribute to CPP2 at a separate rate. CPP2 will gradually build a supplemental benefit on top of the base CPP for anyone who contributed to it.
If you began your career before 2019, you won't receive the full CPP2 benefit — it phases in over 40 years. Younger workers entering the workforce today will eventually receive a meaningfully higher CPP than previous generations.
OAS: the universal pension
Old Age Security is funded by general tax revenue — not contributions — and is available to most Canadians aged 65 and older who have lived in Canada for at least 10 years after age 18. You do not need to have worked to receive OAS.
| Age | Monthly OAS (2026 approx.) | Note |
|---|---|---|
| 65–74 | $743.05/month | Standard rate; indexed to inflation quarterly |
| 75+ | $817.36/month | Permanent 10% increase introduced in 2022 |
| 70 (deferred) | ~$1,010.55/month | 36% higher by deferring from 65 to 70 |
The OAS clawback: who is affected
OAS is reduced (clawed back) at a rate of 15 cents per dollar of net income above the clawback threshold — $93,454 for the July 2026–June 2027 recovery period (based on your 2025 net income). OAS for ages 65–74 is fully eliminated at $152,062, and for ages 75+ at $157,923. If your retirement income from RRIF withdrawals, CPP, pension, and other sources exceeds the threshold, you will lose some or all of your OAS.
When should you start CPP?
Take CPP at 70 if you can afford to wait. The 42% boost is permanent and inflation-indexed. For someone in good health who expects to live past 83–85, delaying from 65 to 70 produces more lifetime income. Use RRSP/RRIF withdrawals, TFSA income, or savings to bridge the gap between 65 and 70.
Take CPP at 65 (or earlier) if: you are in poor health and have a shorter life expectancy, you need the income now and have limited other assets, or you plan to immediately invest the CPP payment in a higher-return asset.
How CPP and OAS fit into your overall retirement plan
CPP and OAS combined replace only a portion of pre-retirement income — typically $1,500–$2,200/month for someone taking both at 65. Most Canadians need RRSP/RRIF drawdowns, TFSA income, and potentially a workplace pension to fully fund retirement. The earlier you understand your CPP entitlement, the better you can plan your savings rate.
Frequently asked questions
How much is the maximum CPP in 2026?
The maximum CPP retirement pension at age 65 is $1,507.65 per month in 2026 (announced by Service Canada for January 2026). Most Canadians receive significantly less — the average is around $850/month — because the maximum requires contributing at or above the YMPE for most of your career. Your personal estimate is available on My Service Canada Account.
When can I start receiving CPP?
You can start CPP as early as age 60 (with a permanent 36% reduction) or as late as age 70 (with a permanent 42% increase compared to age 65). You can apply up to 11 months before you want payments to begin. There is no benefit to delaying past age 70.
What is the OAS clawback threshold in 2026?
For the July 2026–June 2027 OAS recovery period, the clawback begins at $93,454 of net income (based on your 2025 tax return), at a rate of 15 cents per dollar over that threshold. It is fully eliminated at $152,062 (ages 65–74) or $157,923 (ages 75+). TFSA withdrawals do not count as income and do not trigger the clawback.
Can I collect both CPP and OAS?
Yes. CPP and OAS are separate programs and you can receive both simultaneously. CPP is based on your work contributions; OAS is based on residency. Most Canadians who have worked receive both, starting at age 65 (or earlier/later for CPP).