[2020-07-08 Economic and Fiscal Snapshot]

An extension of capital cost allowance (CCA) classes 54 and 55 to used vehicles has been announced.

[2020-12-15 Legislative Proposals]

The Government has proposed a temporary enhanced first-year capital CCA rate of 100% for eligible new and used fully electric or hydrogen powered automotive equipment and vehicles that currently do not benefit from the accelerated rate provided by classes 54 and 55. These vehicles and equipment would be included in new class 56. They would have to be acquired after March 1, 2020, and become available for use before 2028.

The enhanced rate would apply only for the tax year in which the equipment or vehicle first becomes available for use. It would be subject to the following phase-out:

  • 100% after March 1, 2020 and before 2024
  • 75% after 2023 and before 2026
  • 55% after 2025 and before 2028

The CCA would be deductible on any remaining balance on a declining-balance basis at a rate of 30%.