Capital Cost Allowance (CCA) Calculator Canada

What capital cost allowance is and what this calculator shows

Capital cost allowance is how Canadian tax law lets you write off the cost of a business or rental asset over time. This calculator takes the cost of an asset, its CCA class, the number of years to project and your marginal tax rate, and returns the first-year claim, the second-year claim, the running total, the undepreciated capital cost (UCC) left in the class at the end, and the tax those deductions save.

Your financial statements may write an asset down in a straight line over its useful life, but for tax you must use the class rate set by the Income Tax Regulations, on a declining balance. The calculator follows the tax rules.

How the declining-balance calculation works

Every depreciable asset falls into a class with a fixed rate. Assets in the same class are pooled, so the calculation runs on the class as a whole rather than asset by asset.

In the year of acquisition, the half-year rule normally limits how much of the new addition counts. The Accelerated Investment Incentive suspends that rule for eligible property that becomes available for use from 2024 to 2027, so the rule is off by default here; tick the box in the advanced options for property that does not qualify. With the default inputs, a $60,000 Class 8 purchase at 20% gives a first-year claim of $12,000, and the claims over five years total $40,339.20, leaving $19,660.80 in the class.

With the half-year rule switched on, only half the addition counts in year one. The same purchase then gives a first claim of 20% of $30,000, which is $6,000, and $54,000 of UCC is carried into year two. From then on the claim is the class rate times the UCC at the start of the year: $6,000, $10,800, $8,640, $6,912 and $5,529.60, a total of $37,881.60 over five years with $22,118.40 left. That is the pattern the chart shows under the rule: a small first year, a peak in the second, then a steady decline.

Because the balance is multiplied by a fraction each year, it never quite reaches zero. That remainder matters when you dispose of the asset, which is where recapture and terminal losses come in.

Classes, rates and the vehicle ceiling

The class you choose changes the answer more than anything else. Buildings acquired after 1987 are in Class 1 at 4%, which is why real estate is written off so slowly. Furniture, fixtures and most equipment are Class 8 at 20%. General motor vehicles are Class 10 at 30%. Computer hardware and systems software are Class 50 at 55%, so a laptop is largely written off within three years. Manufacturing and processing machinery acquired before 2026 is in Class 53 at 50%, and zero-emission vehicles have their own Classes 54 and 55.

A passenger vehicle costing more than the prescribed ceiling goes into Class 10.1 rather than Class 10, and the amount added to the class is capped at the ceiling whatever you paid. Buy a $65,000 car and only the ceiling amount enters the class. Class 10.1 also differs on disposal: each vehicle has its own class, and there is no recapture and no terminal loss.

Every rate, the half-year fraction and the vehicle ceiling are supplied to the calculator as parameters drawn from CRA and Department of Finance publications, so when a rate or ceiling changes the tool follows.

Business use, immediate expensing and opening balances

• Business-use percentage scales the cost before anything else. A $4,000 laptop used 80% for business adds $3,200 to the class, and every later figure follows from that.
• Opening UCC lets you continue an existing class rather than start a new one. The half-year rule applies only to the new addition, never to the balance already in the class, and the calculator handles that split.
• Immediate expensing is entered as a dollar figure rather than calculated, because the temporary incentive that allowed up to $1.5 million of immediate expensing has ended for most taxpayers. Anything you enter is deducted in full in year one and removed from the addition before the half-year rule is applied.

Leave the half-year rule off for property eligible for the Accelerated Investment Incentive and for the few classes the rule never applied to. Switch it on for property that does not qualify, such as property acquired from a person you do not deal with at arm’s length.

What the tax saving figure means

The tax saving is the deduction multiplied by the marginal rate you enter. It is a reasonable first estimate for an unincorporated business or a rental owner, but treat it as approximate. A corporation is taxed at the small business or general corporate rate rather than a personal marginal rate. A CCA claim that moves you into a lower bracket saves tax at a blended rate. And on a rental property, CCA cannot create or increase a rental loss, so your claim may be capped well below the maximum shown.

CCA defers tax rather than eliminating it. Every dollar you deduct reduces the UCC, which increases the recapture waiting for you on disposal. The benefit is the time value of money, and the chance of claiming at a higher marginal rate than you will face later.

All figures from this tool are estimates based on the values you enter and the class rates supplied. They are general information, not tax or accounting advice. Confirm the right class for your asset with CRA guidance and speak to a qualified Canadian accountant before filing a CCA claim.

About This Tool: Capital Cost Allowance

Capital cost allowance: use this tool to get an instant, accurate estimate. The figures follow official CRA guidance and every rate and threshold is kept up to date for 2026. Adjust the inputs above to match your situation, or browse all our calculators to plan your next step.