Accelerated Investment Incentive Property (AIIP)

Definition

Accelerated Investment Incentive Property (AIIP) is a temporary CCA regime introduced in the 2018 Fall Economic Statement. For qualifying property, the half-year rule is suspended and the first-year CCA is increased to 1.5× the normal declining-balance amount. The policy was designed to encourage business investment. AIIP covers property acquired after November 20, 2018 and before 2025. The 1.5× uplift applied to AIIP that became available for use before 2024; AIIP that becomes available for use from 2024 to 2027 keeps only the suspension of the half-year rule. Property acquired after 2024 is reaccelerated investment incentive property (Regulation 1104(4.01)), added by the Budget 2025 Implementation Act, No. 1 (assented to March 26, 2026). It restores the 1.5× first-year claim for property that becomes available for use before 2030, and suspends the half-year rule without an uplift from 2030 to 2033. The factors for each class and year are set in Regulation 1100(2).

September 2026 proposal

As of September 23, 2026, this page’s calculations use the enacted regulations. Finance’s September 15 Productivity Mega Deduction announcement proposes permanent immediate expensing for most depreciable property acquired from that date, with exclusions. The announcement describes a proposal; these examples do not treat it as enacted. Check subsequent legislation and CRA filing guidance before claiming the proposed treatment for a later purchase.

Key rules

• To be AIIP, the property must (per Regulation 1104(4)):
  • Be acquired after November 20, 2018 and before 2025.
  • Become available for use before 2028.
  • Not be in Classes 54 to 56 (zero-emission vehicles and equipment), which have their own first-year factors.
  • Meet one of two tests: no one has deducted CCA or a terminal loss on it for a taxation year ending before the taxpayer acquired it, or it was never owned by the taxpayer, or by a person not dealing at arm's length with the taxpayer while that person owned it, and was not acquired on a tax-deferred rollover. Used property bought from an unrelated seller therefore usually qualifies.
• Reaccelerated investment incentive property meets the same two tests, but is acquired after 2024 and must become available for use before 2034 (Regulation 1104(4.01)).
• First-year claim for most classes (Regulation 1100(2)):

• Some classes have their own factors in Regulation 1100(2) that write most 2026 purchases off in full in the first year:
  • Class 50 computers (and Class 44 patents and Class 46 data network equipment) acquired after April 15, 2024 and available for use before 2027: 100%. For availability in 2027, qualifying AIIP or RAIIP receives the class rate without the half-year reduction. For availability from 2028 to 2033, that result requires RAIIP; AIIP eligibility has ended. The incentive does not extend beyond 2033 under these enacted rules.
  • Zero-emission vehicles in Classes 54 and 55 acquired after 2024: 100% if available for use before 2030, 75% in 2030 and 2031, and 55% in 2032 and 2033.
  • Manufacturing and processing machinery: Class 53 property acquired in 2025 is written off 100%. The same machinery acquired after 2025 goes in Class 43 and is written off 100% if available for use before 2030, 75% in 2030 and 2031, and 55% in 2032 and 2033. Clean energy equipment in Class 43.1 acquired after 2024 follows the same 100%, 75% and 55% steps through 2033. These temporary accelerated factors end after 2033; apply the ordinary class rules thereafter unless new legislation changes them.
• Property that is not normally subject to the half-year rule, such as Class 14 patents and limited-period licences, gets 1.5× the normal first-year deduction, or 1.25× for AIIP available for use from 2024 to 2027 and for property acquired after 2024 that becomes available for use from 2030 to 2033 (Regulation 1100(1)(c)).
• Short tax years generally require proration under Regulation 1100(3), subject to class-specific exceptions.
• Recapture and terminal loss rules continue to apply normally.

Example

A corporation with a full calendar tax year buys a new server with a $20,000 tax capital cost in March 2026 from an arm's-length dealer. It is reaccelerated investment incentive property in class 50 (55% rate), acquired after April 15, 2024 and available for use before 2027. It is the only class 50 asset.

1. Under normal rules with the half-year rule: CCA = ($20,000 × 50%) × 55% = $5,500.
2. With the Class 50 factor of 9/11 and no half-year rule: CCA = ($20,000 + $20,000 × 9/11) × 55% = $20,000, the full cost.
3. Closing UCC = $20,000 − $20,000 = $0.
4. In year 2 there is nothing left to claim, and later sale proceeds up to cost can create recapture, depending on other transactions in the class.

The front-loaded deduction reduces 2026 tax payable, accepting no deductions in later years. The same server placed in service in 2027 would get $20,000 × 55% = $11,000 in its first year. A $20,000 Class 8 machine bought new in 2026 gets $20,000 × 1.5 × 20% = $6,000.

Common mistakes

• Claiming the accelerated rate on an asset bought from the owner or a related company that had claimed CCA on it. That property fails both tests in Regulation 1104(4) and (4.01).
• Layering AIIP on top of the half-year rule. AIIP replaces the half-year rule for the first year; do not reduce the base by 50% and then multiply by 1.5.
• Treating a 2026 purchase as eligible for the original $1.5M measure. That measure covered property that became available for use before 2024 for CCPCs, and before 2025 for individuals and partnerships of individuals (Regulation 1104(3.1)); the enacted accelerated incentive rules are the baseline used here for 2026 purchases, subject to their conditions and the separately identified September proposal.
• Applying the 2024 to 2027 figure (1.0×, no uplift) to property acquired after 2024. That property gets 1.5× if it becomes available for use before 2030.
• Claiming the incentive on property that becomes available for use after the cutoff: after 2027 for property acquired before 2025, after 2033 for property acquired after 2024.

Official sources

CRA class descriptions, enacted first-year factors, and eligibility definitions.

Related concepts

AIIP is a temporary override to the half-year rule. It ran alongside immediate expensing while that measure lasted, provides the enacted first-year baseline discussed here for qualifying 2026 purchases, and affects the CCA computation for every class, including Class 50 and Class 8. See CCA overview for the mechanics.