Finance’s draft legislation will expand temporary first-year CCA rate of 100% to cover more qualifying zero-emission vehicles and equipment
Finance recently published draft legislation to expand the temporary first-year 100% capital cost allowance (CCA) rate on eligible zero-emission vehicles and equipment to include a wider range of eligible automotive equipment and vehicles.
This enhanced rate will apply to qualifying used and off-road automotive vehicles and equipment that do not currently benefit from the enhanced CCA rate. The 100% CCA rate will gradually phase out for vehicles and equipment that become available for use after 2023, until it eventually expires in 2028. Taxpayers will only be able to claim the enhanced allowance for the taxation year in which a qualifying vehicle is first available for use.
The draft measures were published on December 15, 2020, and will be effective as of March 2, 2020, the date Finance first announced that it would expand the enhanced CCA to qualifying off-road automotive equipment and vehicles.
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