Schedule 8. Capital Cost Allowance

Definition

Schedule 8 is the corporate calculation of capital cost allowance (CCA), recapture and terminal losses. It keeps a separate tax-cost continuity for each prescribed class. Book depreciation is reversed on Schedule 1; the CCA claim from Schedule 8 is deducted on Schedule 1 line 403.

Use the 2026 CRA Schedule 8 for 2025 and later tax years. Its columns distinguish older accelerated investment incentive property (AIIP) from reaccelerated investment incentive property (RIIP, also called RAIIP). Older column-number guides may not match this form.

What to carry into the schedule

For each class, retain opening undepreciated capital cost (UCC), the tax capital cost of additions, when each asset became available for use, sale proceeds and selling costs, government assistance, and the original cost of disposals. Reduce UCC for a disposition using the applicable proceeds calculation capped at the asset’s capital cost. Proceeds above capital cost can create a separate capital gain.

The schedule calculates the permitted first-year adjustment and maximum CCA, then records the amount actually claimed and closing UCC. CCA is generally optional up to the permitted maximum. Keep the continuity even in a year when the corporation chooses a zero claim.

First-year rules for 2026

These are available-for-use rules, not simply purchase-date rules. Used assets can qualify for acceleration under specific conditions; previous ownership, non-arm’s-length transfers and rollovers need review. Short tax years and assistance can also change the permitted deduction. See Accelerated Investment Incentive Property (AIIP) and Immediate Expensing ($1.5M).

The enacted factors and definitions are in Regulation 1100 and Regulation 1104.

Example: a qualifying computer purchase

Vantage Ltd. has a full 2026 tax year, no opening Class 50 balance and no dispositions. It buys a new $3,000 laptop from an unrelated supplier in 2026 and makes it available for use in its business that year. Assume $3,000 is the tax capital cost after recoverable sales tax, all RAIIP conditions are met, and there is no assistance or personal-use adjustment.

If Vantage claims only $1,000, its closing UCC is $2,000. The unused maximum is not a separate credit carried forward; the remaining UCC is subject to the rules for subsequent years.

Recapture is different from a terminal loss

A negative UCC balance before the CCA claim generally creates recapture, which is included in income on Schedule 1 line 107. A positive balance after the last asset in a class is disposed of can create a terminal loss, deducted on line 404. The class closes at zero after either adjustment. Special classes and stop-loss rules can change these results; Class 10.1 passenger vehicles are an important exception.

Land is not depreciable. Separate it from a building’s cost, and do not use accounting net book value in place of UCC.

Related concepts

• Capital Cost Allowance Overview
• Half-Year Rule
• Accelerated Investment Incentive Property (AIIP)
• Immediate Expensing ($1.5M)
• Terminal Loss