To illustrate this phase, consider the purchase of CCA Class 8 equipment purchased for $20,000 in 2025. Rules and Examples. A purchase of $20,000 would yield the following CCA claims in the first two years of use: Phase two includes capital expenditures made during January 1, 2024 to December 31, 2027 and offers incentives to a lesser degree. Before the new accelerated CCA was introduced, most capital additions were only allowed to claim one-half of net additions to the CCA class in the year. In the case of Class 12, which is already eligible for a 100% CCA rate, the incentive applies only to suspend the half-year rule for Class 12 property additions that would otherwise be subject to that rule. The Accelerated Investment Incentive also allows assets to be expensed in the year of acquisition for manufacturing and processing machinery and equipment (Class 53), as well as clean energy equipment (Class 43.1 or 43.2) acquired between November 21, 2018 and December 31, 2023. The Accelerated Investment Incentive also allows assets to be expensed in the year of acquisition for manufacturing and processing machinery and equipment (Class 53), as well as clean energy equipment (Class 43.1 or 43.2) acquired between November 21, 2018 and December 31, 2023.

The Accelerated Investment Incentive will also provide 100% CCA deductions for newly-acquired manufacturing and Focus on Current processing property (Class 53) and eligible clean energy property (Classes 43.1 and 43.2). General Rule; Federal Special Rules. While most capital asset purchases are subject to the half year rule, certain eligible property included in classes 12 & 14 are excluded. To illustrate the new rules consider the purchase of equipment in 2019, which is classified as CCA Class 8 for CCA purposes. Before the new accelerated CCA was introduced, most capital additions were only allowed to claim one-half of net additions to the CCA class in the year. This condition is commonly met when the asset is being used to generate income for the business, or when the property has been delivered and it is capable of producing a product or performing a service for which the business could sell. Please note that accelerated CCA will not be available on capital assets acquired from non-arms length persons including related parties or assets transferred to the taxpayer on a rollover basis. For example, if you purchased a vehicle for $25,000 in Class 10, you would only be able to claim half of addition at 30% CCA rate in the first year which equals $3,750 tax deduction. Do you have a question about this FAQ? There are separate classes of CCA for property, plant, vehicles and various types of equipment. Our clients are primarily manufacturing and distribution companies, but we also have a division specializing in International tax, which includes Canadian companies expanding into foreign markets and foreign companies expanding into Canada. This incentive can be applied to eligible property for which CCA is calculated on a declining-balance basis or a straight-line basis. For more information on accelerated CCA or timing of purchasing capital assets, please contact us.

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