CCPC immediate expensing: $1.5M ended 2023; 2026 draft has no cap

Which immediate expensing rule covers your client's purchase?

The date the property was acquired and the date it became available for use decide everything. The $1.5 million CCPC rule only reaches property acquired after April 18, 2021 that became available for use before 2024 laws-lois.justice.gc.ca. Property bought since then falls under narrower class rules, and anything acquired on or after September 15, 2026 may fall under a new draft with no dollar cap canada.ca.

The class 44, 46, 50, 53 and 43.1 rows come from the CRA's Schedule 8 instructions, which describe each as a full first year write off for reaccelerated investment incentive property canada.ca. The detail on those classes sits on the accelerated investment incentive page, and rates by class are in the CCA classes table. New class 43.1 equipment such as solar panels and heat pumps can also earn the refundable clean technology investment tax credit.

The $1.5 million CCPC deduction could create a loss, but only on designated property

Regulation 1100(0.1) allows a deduction equal to the least of three amounts: the immediate expensing limit, the UCC of designated immediate expensing property (DIEP) at year end before any CCA, and, only for a taxpayer that isn't a CCPC, the income from the business the property is used in laws-lois.justice.gc.ca. Because that third cap skips CCPCs, a CCPC could expense into a loss.

The CCPC had to be a CCPC throughout the year. The property had to be new to it, or at least not previously owned by it or a person it didn't deal with at arm's length, and not received on a rollover laws-lois.justice.gc.ca. Classes 1 to 6, 14.1, 17, 47, 49 and 51 were excluded, which keeps out buildings and goodwill.

The property also had to be designated on a prescribed form filed no later than 12 months after the CCPC's filing due date for that year laws-lois.justice.gc.ca. The T2 is due six months after year end canada.ca, so the latest year that could hold eligible property was due by mid 2025, and every designation window had closed by mid 2026.

Unused room doesn't carry forward, and when designated property spans several classes, your client picks which class takes the deduction canada.ca. Cost above the limit goes into the class and earns regular CCA. One trap lingers: a passenger vehicle that was ever DIEP stays exposed to recapture, unlike other Class 10.1 cars canada.ca. See the class 10.1 limit page for that cap.

Associated corporations shared one $1.5 million, and short years got less

An associated CCPC's limit was nil unless every associated member filed an agreement assigning percentages of the $1.5 million. If the percentages totalled more than 100%, every member's limit was nil laws-lois.justice.gc.ca. Association follows section 256, with partnerships and individuals deemed to be corporations for the test. For the control rules, see associated corporations.

A taxation year shorter than 51 weeks prorated the limit by days over 365 laws-lois.justice.gc.ca.

What the September 2026 Productivity Mega Deduction would change

Finance announced on September 15, 2026 a permanent deduction of the full cost of most depreciable property acquired on or after that date, in the year it becomes available for use canada.ca. Excluded: buildings in Classes 1 and 3, Classes 14 and 14.1 (goodwill, franchises, licences), Class 51, certain vehicles in Classes 10 and 10.1, and property under Schedules V and VI. Used property qualifies only if neither your client nor a person not at arm's length owned it before, and it didn't arrive on a rollover.

The draft regulations repeal the DIEP and eligible person or partnership definitions and subsections 1104(3.2) to (3.6), which held the $1.5 million limit and the sharing rules canada.ca. A corporation of any kind, or a partnership made up only of corporations, can claim without an income limit. Individuals and other partnerships can't use it to create or increase a loss. The excluded vehicles are passenger vehicles and taxis that were used before or assembled outside Canada, and a taxpayer can elect a Class 10.1 car out.

It's a proposal with draft legislation only, so a claim in a 2026 return relies on a measure that hasn't passed. Property that doesn't qualify keeps the existing temporary accelerated investment incentive canada.ca.

Two purchases either side of September 15, 2026 give $520,000 or $240,000 of CCA

Your client is a CCPC with a December 31, 2026 year end. It buys $400,000 of Class 8 furniture and equipment (20%) on June 1, 2026 and another $400,000 on October 1, 2026, all new and available for use on the purchase date. The June purchase is reaccelerated investment incentive property, so Regulation 1100(2) grosses up the addition by one half before the rate applies laws-lois.justice.gc.ca. The Class 8 rate is from the CRA guide canada.ca.

The same $800,000 produces $280,000 more CCA in 2026 if the draft becomes law. Total CCA over the assets' life doesn't change, only its timing. Under the draft, no other CCA is claimed on an immediate expensing property in its first year, so if your client claims less than the full $400,000 it can't top up with regular CCA on that property that year canada.ca.

Budget 2025 expensing for manufacturing buildings is still a bill

Budget 2025 proposed full first year expensing of eligible manufacturing or processing buildings, including additions and alterations, when at least 90% of floor space is used for manufacturing or processing. It would apply to buildings acquired on or after Budget Day and first used before 2030, then 75% for first use in 2030 or 2031 and 55% in 2032 or 2033 budget.canada.ca. The CRA dates it to property acquired after November 3, 2025 canada.ca.

That measure sits in Bill C-31, introduced in May 2026 canada.ca. As of October 2026 it's still in committee in the House of Commons, with no Royal Assent parl.ca. Bill C-15, which received Royal Assent on March 26, 2026, introduced the Budget 2025 productivity super deduction canada.ca, but the building measure was left for the second bill. The Mega Deduction draft leaves these buildings out because they are Class 1, so they rely on the Budget 2025 rule canada.ca.