Small business tax · Depreciation
CCA calculator.
Enter the cost, the CRA class rate and the years to see the UCC and CCA claim each year.
Inputs
CCA schedule
Enter the amounts.
How capital cost allowance works
CCA lets a business deduct the cost of depreciable property over time. Each CRA class has a maximum rate applied to the undepreciated capital cost (UCC), the declining balance. In the year of purchase the half-year rule generally limits the claim to half of the usual amount (for example 10% instead of 20% for a Class 8 asset), and the full rate applies from year 2. CRA lists exceptions: most Class 12 tools under $500 are fully deductible, and some classes have no half-year rule.
Worked example. A $10,000 Class 8 asset at 20%: year 1 CCA is $1,000 (half-year rule), year 2 is 20% of $9,000, or $1,800, and year 3 is 20% of $7,200, or $1,440.
First-year options and limits
CRA says property available for use from 2024 to 2027 under the Accelerated Investment Incentive gets two times the normal first-year deduction, which is the full class rate when the half-year rule applied. The Department of Finance proposed reinstating a 1.5 times net-addition incentive for property acquired from 2025; CRA's guidance describes the reinstatement as proposed, so the enhanced option is for planning only. Special classes (such as zero-emission vehicles and Class 53), the $39,000 limit on Class 10.1 passenger vehicles, recapture, terminal loss are not modelled. Claiming CCA is optional each year.
Frequently asked questions
How do you calculate CCA?
Multiply the UCC at the start of the year by the class rate. In the first year the half-year rule usually halves the claim. The claim reduces the UCC for next year.
What is the half-year rule?
In the year of acquisition CCA is generally limited to 50% of the normal amount on net additions to a class, unless an exception such as an accelerated first-year allowance suspends it.
What CCA class is a computer?
CRA's class list shows Class 50 at 55% for computer hardware and Class 8 at 20% for most furniture and equipment. Check the class list for your asset.
Do I have to claim the maximum CCA?
No. CCA is optional and you can claim any amount from zero up to the maximum each year.
Sources
Checked (retrieved from the publisher)
- CRA: Classes of depreciable property
- CRA: Accelerated Investment Incentive
- Department of Finance: Tax Measures, Supplementary Information (reinstated incentive proposal)
Runs entirely in your browser. Nothing you type is sent or stored.
Scope
Planning schedule on a single asset. Class rules, first-year allowances and the status of proposed changes should be confirmed on canada.ca or with an accountant.