Business English Lesson – Advanced Level's archive Capital Cost Allowance 1. David Trahair, C.A. explains that although most expenses are deductible in the year you paid them, there are types of purchases that are differently. accounted bought measured treated 2. For example, purchases of property such as computers, office furniture, buildings, and manufacturing equipment are not usually written in the year of acquisition. down in off up 3. These types of properties will or become obsolete over a number of years; in recognizing this, you can make a yearly deduction for their cost for income tax purposes called capital cost allowance. turn out turn over wear down wear out 4. All property of a capital nature that you purchase must be grouped in a class to that item. and all property in that class is grouped together and the total cost is used to determine the amount of capital cost allowance. especially special specific specified 5. Classes typically use a balance to depreciate property and each class is designated a maximum fixed percentage for the year; there are 44 classes of property with rates in the classes varying from as low as 4% to as high as 100%. declining decreasing receding reclining 6. If your taxation year is less than twelve months, then the allowable deduction amount will be to a portion of the maximum amount allowed. appropriated apropos prioritized prorated 7. Generally, for the year of acquisition the half-rate rule applies, so only 50% of the maximum deduction amount of a particular class can be claimed listed made reserved 8. can occur if, when you sell the property, the sale price is more than the total of the undepreciated capital cost (U.C.C.) for that class at the beginning of the period and there were no more items left in that class. Recapture Reclamation Refund Reimbursement 9. loss will occur if you have an undepreciated capital cost for a class but have no more physical property. (i.e. you could have sold an asset for less than its U.C.C.). An intentional An interim A temporary A terminal 10. This amount is deductible from your business income for the year that you of the property. declared depreciated despaired disposed . Business English Lesson – Advanced Level's archive Capital Cost Allowance 1. David Trahair, C.A. explains that although most. years; in recognizing this, you can make a yearly deduction for their cost for income tax purposes called capital cost allowance. turn out turn over wear down wear out 4. All property. item. and all property in that class is grouped together and the total cost is used to determine the amount of capital cost allowance. especially special specific specified 5. Classes typically