RSM324H1 Chapter 6: Chapter 6 - CCA
Document Summary
Contribution to business each year of useful life. Taxpayer must have legal title to property or incidents of title ex. possession, use, risk. And asset must be available for use to earn business / investment income. Building under construction not eligible for cca deduction. Cca deductions in first year of asset"s acquisition = max. Does not apply to class 14, specific items in class 12. Cca limited when taxation year is < 365 days --> prorate* Assets of same class placed in common pool only if used in same business. Cca reduction = max. of original capital cost of asset. Excess of original capital cost = capital gain on disposition. For additions and dispositions in the same year. 1/2 rule applies only on amount that is additions - disposals. Given that all assets in class have been disposed off. Capital gain if asset"s sale price > original cost. Passenger vehicles (vehicles cost > ,000 are class 10. 1 assets)
