Recording Capital Cost Allowance

Capital Cost Allowance (CCA) is a tax deduction for businesses to claim capital asset depreciation.

When you purchase a capital asset, you can’t deduct its entire cost from your income tax that fiscal year. Instead, you can deduct a portion of the expense from your income tax each year as the value of the capital asset depreciates.

Depreciable assets are grouped into classes with different depreciation rates. The most common classes are:

1. To set up your business’s CCA classes and rates, select CCA/Depreciation from the Setup menu.
2. The CCA/Depreciation dialogue box appears. You can work with your CCA classes based on the information on your screen.

• CCA Classes – This tab lists the CCA classes set up in the data file. The default classes include 1, 6, 8, 10, 16, 45 and 50.
• CCA Class 10.1 – This tab lists individual Class 10.1 capital assets.
• Add – Click to add a CCA class. You must add Class 10.1  through the Transaction Entry dialogue box or the Capital Asset Setup dialogue box.
• Edit – Select a CCA class or Class 10.1 capital asset and click Edit to modify it.
• Delete – Select a CCA class and click Delete to delete it. If the class has ever had any activity, you won’t be able to delete it.
• Fiscal Year – You must set up your CCA schedule for each fiscal year you have open. Select a fiscal year from the list.
• Close – Click to close the CCA Schedule dialogue box.

Last updated on June 24, 2016 by FCC AgExpert