Podcast
Questions and Answers
What is the CCA rate for Class 1 buildings bought after 1987 until including 2007?
What is the CCA rate for Class 1 buildings bought after 1987 until including 2007?
What is the CCA rate for buildings bought before 1988?
What is the CCA rate for buildings bought before 1988?
5%
What type of assets does Class 8 cover?
What type of assets does Class 8 cover?
Various machinery, equipment, and furniture
Which of the following items are included in Class 10?
Which of the following items are included in Class 10?
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Class 10.1 is designated for __________ vehicles costing more than $30,000.
Class 10.1 is designated for __________ vehicles costing more than $30,000.
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What is the CCA rate for computer software under Class 12?
What is the CCA rate for computer software under Class 12?
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What is the method of depreciation for leasehold improvements under Class 13?
What is the method of depreciation for leasehold improvements under Class 13?
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What type of assets does Class 14 cover?
What type of assets does Class 14 cover?
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What is the CCA rate for Class 14.1 assets?
What is the CCA rate for Class 14.1 assets?
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Class 16 has a CCA rate of __________.
Class 16 has a CCA rate of __________.
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What is the CCA rate for patents with a useful life greater than or equal to 4 years under Class 44?
What is the CCA rate for patents with a useful life greater than or equal to 4 years under Class 44?
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Which class includes computer hardware and system software acquired after January 31, 2011?
Which class includes computer hardware and system software acquired after January 31, 2011?
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Study Notes
Class 1
- Depreciation rates: 4%, 6%, and 10% based on the purpose of the building.
- Applicable to various structures including buildings, bridges, and tunnels.
- 4% rate for buildings acquired after 1987 until 2007.
- 5% for buildings bought before 1988 which fall under Class 3.
- Electing Class 1 after 2007 for commercial buildings.
- 6% rate for buildings used 90% for commercial purposes (excluding manufacturing).
- 10% rate for buildings used 90% for manufacturing and processing goods.
- Rental buildings costing $50,000 or more must be in a separate Class 1.
- Land itself is not depreciable.
Class 3
- Depreciation rate of 5%.
- Contains buildings acquired before 1988 and various structures like breakwaters and docks.
- Rental buildings costing $50,000 or more must be in a separate Class.
Class 8
- Depreciation rate of 20% for machinery, equipment, and furniture.
- Covers various items such as electrical equipment and outdoor advertising signs.
- Tools costing $500 or more are included.
- Office equipment exceeding $1,000 can be elected for a separate class.
Class 10
- Depreciation rate of 30% for vehicles costing $30,000 or less.
- Includes trucks, trailers, buses, and mining equipment.
- Covers portable equipment used in construction.
Class 10.1
- Depreciation rate of 30% for passenger luxury vehicles costing over $30,000.
- CCA limit set at $30,000.
- Each luxury vehicle must be assigned to a separate Class 10.1.
- No terminal loss or recapture allowed.
Class 12
- 100% depreciation for computer software and certain small asset categories.
- Excludes system software, covers books, kitchen utensils, and dental instruments.
- Includes tools costing less than $500.
Class 13
- Straight line method for leasehold improvements and renovations.
- Maximum deduction determined by the lesser of 1/5 of capital cost or capital cost divided by lease term.
Class 14
- Straight line amortization for limited-life intangible assets.
- Covers copyrights, franchises, and licenses with limited valid periods.
Class 14.1
- Intangible assets with unlimited life are assessed.
- New rules as of 2017 include 100% additions and dispositions with 5% CCA.
- 1/2 year rule applies with no terminal losses for ongoing businesses.
- Goodwill and other unlimited life intangible assets do not require separate classes.
Class 16
- Depreciation rate of 40% for taxis and coin-operated video games.
Class 44
- 25% depreciation for patents with a useful life of four years or longer.
Class 50
- 55% depreciation for computer hardware and system software acquired after January 31, 2011.
- Includes smartphones and tablets; basic cellphones fall under Class 8.
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Description
Test your knowledge on the different depreciation rates for various classes of buildings and equipment. This quiz covers Class 1, Class 3, and Class 8 depreciation guidelines and their applicable rates. Understand the specific criteria for each class and the implications for commercial and rental structures.
