Capital Cost Allowance (CCA)
Track business assets and CRA deductions
CCA calculator for Canadian businesses. Select the CCA class, enter the asset cost, and get your first-year deduction plus a 5-year depreciation schedule. No signup needed.
CCA Depreciation Calculator
Select a CCA class, enter the asset cost, and see your CRA depreciation deduction
General-purpose electronic data-processing equipment (computers) and systems software
Percentage of asset used for business (personal use portion is not deductible)
Treated as purchased mid-year.
New property gets the Accelerated Investment Incentive (AIIP): 1.5× for most classes bought from 2025, a 100% write-off for computers bought before 2027. Property you or a related person owned or used before gets the half-year rule (0.5×).
Class 50 — 55% Declining Balance
Results are estimates; confirm your claim with your accountant.
5-Year Depreciation Schedule
| Year | Opening UCC | CCA Claimed | Closing UCC | Cumulative CCA |
|---|
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Start Tracking AssetsCCA Class Reference Table
The 12 most common CCA classes covering 95%+ of small business assets in Canada. Rates are set by the CRA and apply using the declining balance method.
| Class | Rate | Description | Examples |
|---|---|---|---|
| 1 | 4% | Buildings acquired after 1987 | Commercial buildings, rental properties |
| 6 | 10% | Frame/log/stucco buildings | Wood frame buildings, log structures |
| 8 | 20% | Furniture, fixtures, equipment over $500 | Office furniture, printers, photocopiers |
| 10 | 30% | Motor vehicles | Cars, trucks, vans (under $39K) |
| 10.1 | 30% | Passenger vehicles over $39,000 cap | Luxury vehicles, expensive passenger cars |
| 12 | 100% | Small tools <$500, software | Hand tools, software licences, utensils |
| 14 | Varies* | Patents, franchises, licences | Patents, franchise agreements |
| 43 | 30% | Manufacturing & processing equipment | Manufacturing machinery, processing equipment |
| 46 | 30% | Data network infrastructure | Routers, switches, network cabling |
| 50 | 55% | Computers and systems software | Laptops, desktops, tablets, servers |
| 54 | 30% | Zero-emission vehicles ($61K cap) | Electric cars, plug-in hybrids |
| 55 | 40% | Zero-emission vehicles (large) | Electric trucks, large EVs |
*Class 14 uses straight-line depreciation over the remaining useful life of the asset (e.g., a patent with 20 years remaining = 5%/year). Unlike other classes, it does not use the declining balance method.
How CCA Works
Declining Balance Method
CCA uses a declining balance method. Each year, you apply the CCA rate to the remaining undepreciated capital cost (UCC), not the original purchase price.
- Year 1: CCA on cost (adjusted)
- Year 2+: CCA on remaining UCC
- Balance never reaches zero
- Larger deductions in early years
Half-Year Rule
In the year you acquire an asset, only 50% of the net addition is included in the CCA base. This applies to property you or a related person owned or used before, and whenever AIIP does not.
- First year: base = cost × 0.5
- Applies to net additions only
- Subsequent years: full UCC
- Prevents full-year claim on late purchases
AIIP (2018-2033, reaccelerated from 2025)
The Accelerated Investment Incentive replaces the half-year rule with a larger first-year deduction for property new to you. For property bought from 2025 it is the reaccelerated incentive:
- Bought 2025 or later: 1.5× for most classes (1.0× if available for use 2030–2033)
- Computers (Class 50) bought before 2027: 100% first-year write-off
- Bought Nov 21, 2018 to 2024: 1.5× (1.0× if available for use in 2024)
- Owned or used before by you or a related person: half-year rule (0.5×)
Recapture & Terminal Loss
When you sell or dispose of assets, special rules apply to balance the CCA previously claimed.
- Recapture: UCC goes negative add back as income
- Terminal loss: UCC positive, no assets left deduct
- Class 10.1: no terminal loss allowed
- Proceeds capped at original cost
T2125 Area A — CCA Columns
Self-employed Canadians report CCA on Form T2125, Area A. The form has 19 columns covering additions, dispositions, DIEP (Designated Immediate Expensing Property), AIIP/ZEV adjustments, and the final CCA calculation.
| Col | T2125 Field | Description |
|---|---|---|
| 1 | Class number | CCA class (e.g., 8, 10, 50) |
| 2 | UCC at start of year | Closing UCC carried forward from previous year |
| 3 | Cost of additions in the year | Total cost of new assets purchased this tax year |
| 4 | Additions that are DIEPs (from col 3) | Designated Immediate Expensing Property (eligible CCPCs/individuals) |
| 5 | Proceeds of dispositions | Lesser of sale price or original cost of disposed assets |
| 6 | Dispositions of DIEP (from col 5) | Proceeds from disposed DIEP assets |
| 7 | UCC after additions & dispositions | Col 2 + Col 3 − Col 5 |
| 8 | UCC of DIEP | Portion of col 7 attributable to DIEP |
| 9 | Immediate expensing amount (DIEP) | Amount immediately expensed for DIEP (up to $1.5M limit) |
| 10 | Remaining additions after immediate expensing | Col 3 − Col 4 + amounts not immediately expensed |
| 11 | Remaining additions that are AIIPs or ZEVs | AIIP/ZEV portion of col 10 additions |
| 12 | Remaining UCC after immediate expensing | Col 7 − Col 9 |
| 13 | Dispositions to reduce AIIP/ZEV additions | Proceeds available to offset AIIP/ZEV additions |
| 14 | Adjustment for AIIP/ZEV additions | AIIP factor applied to net AIIP/ZEV additions (1.5× for most new property in 2026) |
| 15 | Half-year rule adjustment | 0.5× reduction for non-AIIP current-year additions |
| 16 | Base amount for CCA | Col 12 + Col 14 − Col 15 |
| 17 | Rate (%) | CCA class rate (e.g., 55%, 30%, 20%) |
| 18 | CCA for the year | Col 16 × Col 17 (adjusted for business use) |
| 19 | UCC at end of year | Col 7 − Col 9 − Col 18 (carried to next year) |
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Get StartedQuick CCA Examples (2026 AIIP Rate)
Pre-calculated first-year CCA for common business assets bought new in 2026 under the reaccelerated Accelerated Investment Incentive (AIIP), at 100% business use. Tax savings estimated at a 30% marginal rate.
| Asset | Cost | Class | First-Year CCA | Tax Savings |
|---|---|---|---|---|
| Laptop | $2,000 | 50 (55%) | $2,000 | ~$600 |
| Office Desk & Chair | $1,500 | 8 (20%) | $450 | ~$135 |
| Work Truck | $35,000 | 10 (30%) | $15,750 | ~$4,725 |
| Hand Tools | $400 | 12 (100%) | $400 | ~$120 |
| Manufacturing Equipment | $25,000 | 43 (30%) | $25,000 | ~$7,500 |
| Electric Vehicle | $55,000 | 54 (30%) | $55,000 | ~$16,500 |
Class 54 cost capped at $61,000. Class 10.1 cost capped at $39,000 (2026). New property bought in 2026: first-year CCA = cost × 1.5 × rate for most classes (Class 12: cost × rate), never more than the cost; laptops (Class 50), manufacturing equipment (Class 43) and zero-emission vehicles (Class 54) are written off in full. Property you or a related person owned or used before: cost × 0.5 × rate.
CCA Tips for Canadian Businesses
Keep Detailed Records
Document the purchase date, cost, and business use for every capital asset. Keep receipts for 6 years. The CRA can audit your CCA claims and ask for supporting documentation.
Choose the Right Class
Misclassifying an asset can result in claiming too much or too little CCA. A laptop is Class 50 (55%), not Class 8 (20%). Software under $500 is Class 12 (100%), not Class 50.
Buy Before Year-End for AIIP
Assets acquired and available for use before December 31 qualify for AIIP in that tax year. For 2026, new property gets 1.5× the normal first-year base for most classes, and new computers are written off in full. The reaccelerated incentive covers property available for use before 2034.
Document Business Use
If an asset is used partly for personal purposes, only the business-use portion is deductible. Keep a log showing business vs. personal use, especially for vehicles.
Frequently Asked Questions
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