There are likely to be very few clients who might be in this situation, however, if a person collecting OAS has a large capital gain in Section 6 on Schedule 3 (Other mortgage foreclosures and conditional sales repossessions), the OAS clawback doesn’t calculate.
On the Social Benefits Repayment Worksheet the capital gain ends up being incorrectly categorized as “RDSP Income”, and this amount gets deducted from the income calculation.
Person with date of birth before 1953
Enter 7121.31 on the T4A(OAS) slip
Enter 400,000 as Proceeds in Section 6 of Schedule 3 (Capital Gain = 400k)
Instead of 7121.31 in Social Benefits Repayment on line 235, the software calculates as zero.
The Social Benefits Repayment Worksheet somewhat explains what is happening here.