ITCThis is the code for investment tax credits.Enter the keyword ITC and select from the list of codes available in the current tax year. The ITC is based on a percentage of the investment cost (the cost of the property you bought or the expenditures you made). If you received, are entitled to receive, or can reasonably expect to receive any reimbursement, inducement, or government or non-government assistance (including grants, subsidies, forgivable loans, or deductions from tax and investment allowances) that can reasonably be considered to relate to the property or expenditure, you have to decrease your investment cost by the amount you received, are entitled to receive, or can reasonably expect to receive. If you repay any of this assistance, add the repayment to the investment cost. Calculate the ITC for any repayment using the same percentage you used for the original investment cost. Determine your ITC at the end of 2023. If the fiscal year-end of your business is in 2023, include any ITC you earn on the property you buy during the calendar year. Investments and expenditures are eligible for an ITC only when the income from the related business is subject to Part I of the Income Tax Act. Properties acquired are eligible for an ITC claim only when the properties are considered to be available for use. For an explanation of available for use, see any of the following guides: Guide T4002, Business and Professional Income, Guide T4003, Farming Income, Guide RC4060, Farming Income and the AgriStability and AgriInvest Programs, Guide RC4408, Farming Income and the AgriStability and AgriInvest Programs Harmonized Guide, or Guide T4004, Fishing Income. You can use the ITC that you earn in 2023 to reduce your federal tax for a previous year, for the 2023 tax year or for a future year. Any unused ITC credits may be refunded. The following options are applicable for the keyword ITC.
This is the capital cost allowance (CCA) class applicable to the particular investment or expenditure, and the CCA group identifier.
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| CECA balances on December 31, 2016 | CECA's account balances are transferred on January 1, 2017 to the new CCA class. The UCC on January 1, 2017 must equal the amount that would have been the balance of the CECA account on January 1, 2017.> |
| The total capital cost of all property included in Class 14.1 | In order to be able to calculate the tax consequences (recapture of depreciation and capital gains) when disposing of property included in Class 14.1, it is necessary to establish the capital cost of the acquired properties. The capital cost of all preperty included in Class 14.1 in accordance with paragraph 13(38)a) ITA, is deemed to be the amount determined by the formula 4/3 x (A + B + C). A = The positive balance of the CECA B = The amount of deductions made in the past on the CECA account (depreciation) C = The negatve balance of the CECA |
| The capital cost of each property included in Class 14.1 | The Act requires that the capital cost be allocated between goodwill and each identifiable property included in this new depreciation class [ITA 13(37)b)]. |
| The capital cost allowance deemed taken | In order to be able to eventually calculate the tax consequences (depreciation recovery and capital gain) when disposing of a Class 14.1 property, it is necessary to determine the capital cost allowance deemed taken. The amount of depreciation deemed taken as per paragraph 13(38)c) of the ITA will be deemed to be equal to (capital cost determined as per paragraph 13(38)a) - CE C account balance). |
| The depreciation rate | The depreciation rate will be 7% for the first 10 years (for tax years ending before 2027). |
| Additional depreciation (subparagraph 1100(1)c.1) ITR) | To allow the elimination of small initial balances, the CCA for expenses incurred before 2017 corresponds to the greater of: 1) $500 (without exceeding the UCC), or 2) The amount that would otherwise be deductible for the year. |
| How to process receipts for property or expenditures made before January 1, 2017? | The balance for the new CCA class must be reduced to a rate of 75%. The UCC for new Class 14.1 must be raised to 25% of the lesser between the proceeds of disposition and the cost of the property that was disposed of. |
| Repayment, after December 31, 2016, of government assistance received before January 1, 2017 | Subsection 13(7.41) of the ITA provides that, if a taxpayer has repaid, after December 31, 2016, government assistance that was received before before January 1, 2017, the repayment amount is: 1) Deemed to have been repaid immediately before January 1, 2017, for the purposes of the capital cost of the class and the property. 2) The capital cost of the property and the UCC for Class 14.1 will be retroactively adjusted upwards as of January 1, 2017. 3) No depreciation may be taken on this UCC increase before repayment. |
Enter cumulative eligible capital balances of separate farm businesses in separate CCA-Class groups.Table - Transitional rules: CECA balances prior to January 1, 2017 and Class 14.1
CECA balances on December 31, 2016 CECA's account balances are transferred on January 1, 2017 to the new CCA class. The UCC on January 1, 2017 must equal the amount that would have been the balance of the CECA account on January 1, 2017.> The total capital cost of all property included in Class 14.1 In order to be able to calculate the tax consequences (recapture of depreciation and capital gains) when disposing of property included in Class 14.1, it is necessary to establish the capital cost of the acquired properties. The capital cost of all preperty included in Class 14.1 in accordance with paragraph 13(38)a) ITA, is deemed to be the amount determined by the formula 4/3 x (A + B + C).
A = The positive balance of the CECA
B = The amount of deductions made in the past on the CECA account (depreciation)
C = The negatve balance of the CECAThe capital cost of each property included in Class 14.1 The Act requires that the capital cost be allocated between goodwill and each identifiable property included in this new depreciation class [ITA 13(37)b)]. The capital cost allowance deemed taken In order to be able to eventually calculate the tax consequences (depreciation recovery and capital gain) when disposing of a Class 14.1 property, it is necessary to determine the capital cost allowance deemed taken. The amount of depreciation deemed taken as per paragraph 13(38)c) of the ITA will be deemed to be equal to (capital cost determined as per paragraph 13(38)a) - CEC account balance). The depreciation rate The depreciation rate will be 7% for the first 10 years (for tax years ending before 2027). Additional depreci ation (subparagraph 1100(1)c.1) ITR) To allow the elimination of small initial balances, the CCA for expenses incurred before 2017 corresponds to
the greater of:
1) $500 (without exceeding the UCC), or
2) The amount that would otherwise be deductible for the year.How to process receipts for property or expenditures made before January 1, 2017? The balance for the new CCA class must be reduced to a rate of 75%. The UCC for new Class 14.1 must be raised to 25% of the lesser between the proceeds of disposition and the cost of the property that was disposed of. Repayment, after December 31, 2016, of government assistance received before January 1, 2017 Subsection 13(7.41) of the ITA provides that, if a taxpayer has repaid, after December 31, 2016, government assistance that was received before before January 1, 2017, the repayment amount is:
1) Deemed to have been repaid immediately before January 1, 2017, for the purposes of the capital cost of the class and the property.
2) The capital cost of the property and the UCC for Class 14.1 will be retroactively adjusted upwards as of January 1, 2017.
3) No depreciation may be taken on this UCC increase before repayment.
Property to be included in Class 14.1
- is goodwill;
- was eligible capital property of the taxpayer immediately before January 1, 2017 and is owned by the taxpayer at the beginning of that day; or
- is acquired after 2016, other than
- property that is tangible or, for civil law, corporeal property,
- property that is not acquired for the purpose of gaining or producing income from business,
- property in respect of which any amount is deductible (otherwise than as a result of being included in this class) in computing the taxpayer's income from the business,
- property in respect of which any amount is not deductible in computing the taxpayer's income from the business because of any provision of the Act (other than paragraph 18(1)(b)) or these Regulations,
- an interest in a trust,
- an interest in a partnership,
- a share, bond, debenture, mortgage, hypothecary claim, note, bill or other similar property, or
- property that is an interest in, or for civil law a right in, or a right to acquire, a property described in any of subparagraphs (i) to (vii).
However, since there is only one Class 14.1 and this class is closely associated with the operation of the business, a terminal loss in regards to Class 14.1 can only be claimed if the business has ceased its operations (following a sale or a cessation of its activities). As a matter of fact, under paragraph 13(34)a) of the ITA, if a taxpayer carries on a particular business, there is deemed to be a single goodwill property in respect of the particular business.
The presence of this goodwill will make it impossible to claim a terminal loss, since the class will not be empty.
Moreover, ITA 20(16.1)c) provides that no terminal loss may be deducted in a taxation year in respect of property included in Class 14.1 of Schedule II of the Income Tax Regulations, except when the taxpayer has ceased to carry on the business to which this class relates.
Chart - Comparison of tax rules applicable to eligible capital property before and after January 1, 2017
Tax rules Before 2017 After 2016 Definition Eligible capital property has a separate tax treatment from depreciable property. Eligible capital property is considered depreciable property. Acquisition of eligible capital property 3/4 of capital expenditure is added to the CEC account. 100% of capital expenditure is added to Class 14.1. Depreciation rate 7% of the CEC account. 5% of the UCC balance.
Transitional rules for CEC account balances as of December 31, 2016.Half-year rule Not applicable. Applicable in the year of acquisition. Short fiscal year The expense is deductible in proportion to the number of days out of 365 in the taxation year. The expense is deductible in proportion to the number of days out of 365 in the taxation year. Disposition of eligible capital property Must deduct 3/4 of the proceeds of disposition from the CEC account. Must deduct from the UCC the lesser between the capital cost and the proceeds of disposition. Terminal loss Possible if the class is empty. Possible only if the business has ceased its operations. The CEC account balance (UCC) is negative following a disposition. Disposition results in business income.
It is necessary to calculate the depreciation recovery which will be added to the business income.Disposition results in a capital gain.
It is necessary to calculate the depreciation recovery which will be added to the business income.The CEC account balance (UCC) is positive following a disposition. Carry on the depreciation of the account balance. Carry on the depreciation of the account balance. Incorporation expenses 3/4 of the expense is added to the CEC account. The first $3,000 of these incorporation expenses are considered operating expenses, the difference is added to the UCC.
Woods assets are depreciated based on the number of cords or board feet cut in the taxation year compared to the undepreciated capital cost of the property. Enter the rate to be used in the Timber-Rate keyword in this group.
Taxis, vehicles you use in a daily car-rental business, coin-operated video games or pinball machines acquired after February 15, 1984, and freight trucks acquired after December 6, 1991, that are rated higher than 11,788 kilograms.
Roads, parking lots, sidewalks, airplane runways, storage areas, or similar surface construction.
Pre-May 26/76 motion picture films. In Quebec only, new transport truck acquired after March 30, 2010 with a gross weight of more than 11,788 kg.
Property otherwise included in Class 8 which was acquired between June 14, 1963 and December 31, 1966. The CCA rate is 20% on a declining balance basis for non-residents and 50% on a straight-line basis for Canadian-owned corporations.
Certified Class 1- or Class 3-type buildings acquired between June 12, 1963 and March 31, 1967 or approved capital costs under the Area Development Incentives Act.
Certified Class 8- or Class 19-type property acquired between June 12, 1963 and March 31, 1967 for use in a certified business or approved capital costs under the Area Development Incentives Act.
Most power-operated, movable equipment you bought before 1988 that you use for excavating, moving, placing, or compacting earth, rock, concrete, or asphalt.
Leasehold interests, licenses and buildings on or with respect to the Montreal or Vancouver Expo sites.
Pollution control equipment. The Ontario Current Cost Adjustment is available for purchases of Class 24 and 27 equipment made in or after 1992.
Pre-Oct.23/68 property acquired by Crown or municipally-owned corporations.
Catalysts and pre-May 22/79 deuterium-enriched water.
Pollution control equipment. The Ontario Current Cost Adjustment is available for purchases of Class 24 and 27 equipment made in or after 1992.
Pre-1988 mining equipment used for mine expansion and development.
Pre-1988 manufacturing or processing equipment. Post-1988 equipment should be included in Class 39 (pre-Feb.26/92) or Class 43 (post-Feb.25/92).
Pre-1988 telecommunications satellites or space crafts.
Class 31 and 32 pre-June 18/87 certified MURB buildings with a cost exceeding $50,000 should be entered in separate classes.
Class 31 and 32 pre-June 18/87 certified MURB buildings with a cost exceeding $50,000 should be entered in separate classes.
Timber resource property.
Certified energy conservation or energy-efficient equipment.
Railway cars.
Property acquired by virtue of a lease option agreement at a price less than fair market value when lease rental payments were previously deducted on the property. The excess of the deemed Adjusted Cost Base (see Fed.ITA 13(5.2)) over the purchase price is deemed to be CCA which was previously claimed on the property.No CCA can be claimed while the property is in Class 36 but recapture can occur on the property's disposal.
Amusement park land improvements, buildings and equipment.
Most power-operated, movable equipment you bought after 1987 and use for excavating, moving, placing, or compacting earth, rock, concrete, or asphalt.You can choose to keep an outdoor advertising sign and any property you would usually include in class 38 in a separate class. To do this, attach a letter to your income return for the year you bought the property. In the letter, list the properties you are including in a separate class.
Manufacturing or processing equipment acquired after 1988 and before Feb.26/92. Use Class 43 if the equipment was acquired after Feb.25/92.C.C.A. for Class 39 is 35% in 1989, 30% in 1990 and 25% after 1990. DT Max will calculate a prorated CCA rate when the corporation's taxation year straddles the date on which the rate changed.
The Ontario Current Cost Adjustment is available for purchases of Class 39 manufacturing & processing machinery and equipment made before Jan.1/92.
1988-1990 acquired powered industrial lift trucks, rental portable tools and general-purpose electronic data processing equipment used in the manufacturing and processing of goods.
Pre-1987 mining operations-related machinery and equipment, gas or oil well equipment and heavy oil processing equipment.Most capital assets acquired by mining and oil and gas companies are included in Class 41, which qualifies for a depreciation rate of 25% on a declining balance basis. Class 41 includes:
- All buildings, structures, machinery and equipment used in the extraction and processing (concentrating, smelting and refining) of a mineral resource that is not beyond the prime metal stage or its equivalent;
- Motive equipment and railway facilities (excluding rolling stock) used to produce income from a mine;
- Loading and unloading assets used at the mine or at the mineral processing facilities;
- Electrical generating and distributing equipment used for mining;
- Assets that provide services to the mine or to the community where a substantial portion of the persons employed at the mine reside (hospital, school, airport, fire hall, etc.).
Accelerated Capital Cost Allowance (ACCA)
The amount of ACCA that can be claimed in a year is equal to the balance of unclaimed capital cost in the class, but it cannot exceed the income of the mine. The amount claimed is optional in that any amount can be claimed up to the allowed maximum rate.
Oil sands property acquired after March 18, 2007 is generally included in new CCA Class 41.1.New subsection 1101(4e) prescribes a separate class for single mine properties that are included in paragraph (a) of Class 41.1. Properties included in paragraph (a) of new Class 41.1 remain eligible for the accelerated CCA until 2010.
Beginning in 2011, the accelerated CCA is phased out and the amount of the additional allowance will be reduced each year, regardless of whether the constraint is the income from the mine or the amount of the undepreciated capital cost. The percentage allowed, as accelerated CCA, in each calendar year will be 90% in 2011, 80% in 2012, 60% in 2013 and 30% in 2014 of the amount otherwise allowable as accelerated CCA. No accelerated CCA will be allowed after 2014 and only the regular 25-per-cent CCA rate will apply after 2014.
Under current rules, accelerated CCA is available in the form of an additional allowance which supplements the regular 25-per-cent CCA rate. It allows a taxpayer to deduct, in computing income for a taxation year, up to 100-per-cent of the undepreciated capital cost of the properties included in the separate Class 41, not exceeding the taxpayer's income for the year from the mine (calculated after deducting the regular CCA).
Class 41.2 (25 per cent CCA rate) includes property other than an oil sands property or eligible mine development property,(a) that is acquired by a taxpayer after March 20, 2013 and before 2021 and that, if acquired on March 20, 2013, would be included in paragraph (a) or (a.1) of Class 41; or
(b) that is acquired by a taxpayer after 2020 and that, if acquired on March 20, 2013, would be included in paragraph (a) or (a.1) of Class 41.
These separate classes of properties remain eligible for the full accelerated CCA until 2016. Beginning with 2017, accelerated CCA is phased out and the amount of the additional allowance will be reduced each year, regardless of whether the constraint is the level of project income or the amount of the undepreciated capital cost. The percentage allowed, as accelerated CCA, in each calendar year will be 90% for 2017, 80% for 2018, 60% for 2019 and 30% for 2020 of the amount otherwise allowable as accelerated CCA. No accelerated CCA will be allowed and only the regular 25% CCA rate will apply for assets in this Class after 2020.
Eligible mine development property acquired after March 20, 2013 and before 2018 can be included in Class 41.
Fibre optic cables.
Manufacturing or processing equipment acquired after Feb.25/92.
Includes prescribed energy conservation property (CRCE). This class is broadened to include biogas production equipment and distribution equipment acquired on or after February 23, 2005.
Includes certain high-efficiency cogeneration systems and renewable energy generation equipment acquired on or after February 23, 2005, and before 2025. This accelerated CCA rate will also apply to biogas production equipment and distribution equipment used in district energy systems that rely on efficient cogeneration, acquired on or after February 23, 2005, and before 2025.
Patents and rights to use patented information.
General-purpose electronic data processing equipment and certain ancillary property acquired after March 22, 2004, other than property that is acquired before 2005 in respect of which a taxpayer elects to have the property included in a separated Class 10.
Data network infrastructure equipment and systems software for that equipment acquired after March 22, 2004 that would otherwise be included in Class 8 because of the default provision in paragraph (i) of that Class. For details on the definition of data network infrastructure equipment, see the note accompanying that new definition in amended subsection 1104(2) of the Regulations.
Includes transmission and distribution equipment and structures (excluding buildings) of a distributor of electrical energy acquired on or after February 23, 2005.
Accelerated CCA for liquefied natural gas (LNG) after February 19, 2015 and before 2025.Eligible property used for the liquefaction of natural gas are eligible for a CCA rate of 8% plus the lesser of 22% and income from eligible liquefaction activities attributable to that facility.
Includes combustion turbines that generate electricity (including associated burners and compressors) for property acquired on or after February 23, 2005. A separate class election (presently available for such equipment eligible for the 8% rate) is eliminated for equipment eligible for the 15% CCA rate (class 48).
Includes transmission pipelines for petroleum, natural gas, or related hydrocarbons, including control and monitoring devices, valves, and other ancillary equipment. The 8% CCA rate for transmission pipelines will apply to equipment acquired on or after February 23, 2005. A separate class election is generally available for eligible equipment acquired on or after February 23, 2005.
Computer equipment and systems software acquired after March 18, 2007.
Natural gas distribution pipelines acquired after March 18, 2007. Natural gas distribution pipelines are pipelines through which natural gas is carried from transmission pipelines to consumers. They include both distribution mains, which run to the edge of a customer's property, and service lines, which run from the edge of the customer's property to the house or building.
Include in Class 52 with a CCA rate of 100% (with no half-year rule) general-purpose electronic data-processing equipment (commonly called computer hardware) and systems software for that equipment, including ancillary data-processing equipment, if acquired after January 27, 2009, and before February 2011. To qualify for this rate, the asset must also:
- be situated in Canada;
- not have been used, or acquired for use, for any purpose before it is acquired by the taxpayer; and
- be acquired by the taxpayer:
- for use in a business carried on by the taxpayer in Canada or for the purposes of earning income from property situated in Canada; or
- for lease by the taxpayer to a lessee for use by the lessee in a business carried on by the lessee in Canada or for the purpose of earning income from property situated in Canada.
Class 53 includes machinery and equipment used in Canadian manufacturing acquired after 2015 and before 2026.
Class 54 was created for zero-emission vehicles acquired after March 18, 2019 that would otherwise be included in Class 10 or 10.1, with the same CCA rate of 30%.There is a limit of $55,000 (plus federal and provincial sales taxes), for 2019, on the capital cost for each zero-emission passenger vehicle in Class 54. The limit will be reviewed annually. Class 54 may include both zero-emission passenger vehicles that do and do not exceed the prescribed threshold. However, unlike Class 10.1, Class 54 does not establish a separate class for each vehicle whose cost exceeds the threshold.
If a zero-emission passenger vehicle is disposed of to a person or partnership with whom you deal at arm's length, and its cost exceeds the prescribed amount, the proceeds of disposition will be adjusted based on a factor equal to the prescribed amount as a proportion of the actual cost of the vehicle. For dispositions made after July 29, 2019, based on proposed legislation, the actual cost of the vehicle will also be adjusted for the payment or repayment of government assistance.
The enhanced first-year allowance will be calculated by: :
- 100% after March 18, 2019, and before 2024
- 75% after 2023 and before 2026
- 55% after 2025 and before 2028
The enhanced first-year allowance will be calculated by :
- increasing the net capital cost addition to the new class for property that becomes available for use before 2028, and applying the prescribed CCA rate for the class as described below :
- Applying the prescribed CCA rate of 30% to :
- 2 1/3 times the net addition to the class for property that becomes available for use before 2024
- 1 1/2 times the net addition to the class for property that becomes available for use in 2024 or 2025
- 5/6 times the net addition to the class for property that becomes available for use after 2025 and before 2028
- suspending the existing CCA half-year rule
Class 55 was created for zero-emission vehicles acquired after March 18, 2019 otherwise included in Class 16, with the same CCA rate of 40%.The enhanced first-year allowance will be calculated by: :
- 100% after March 18, 2019, and before 2024
- 75% after 2023 and before 2026
- 55% after 2025 and before 2028
The enhanced first-year allowance will be calculated by :
- increasing the net capital cost addition to the new class for property that becomes available for use before 2028, and applying the prescribed CCA rate for the class as described below :
- Applying the prescribed CCA rate of 40% to :
- 1 1/2 times the net addition to the class for property that becomes available for use before 2024
- 7/8 times the net addition to the class for property that becomes available for use in 2024 or 2025
- 3/8 times the net addition to the class for property that becomes available for use after 2025 and before 2028
- suspending the existing CCA half-year rule
Class 56 includes a temporary enhanced first-year CCA rate of 100% in respect of eligible zero-emission automotive equipment and vehicles that currently do not benefit from the accelerated rate provided by Classes 54 and 55. These vehicles and equipment would be included in new Class 56.To be eligible for this first-year enhanced allowance, a vehicle or equipment must be automotive (i.e., self-propelled) and fully electric or powered by hydrogen. Vehicles or equipment that are powered partially by electricity or hydrogen (which includes hybrid vehicles and vehicles that require human or animal power for propulsion) would not be eligible.
Class 56 would apply to eligible zero-emission automotive equipment and vehicles that are acquired on or after March 2, 2020 and that become available for use before 2028, subject to a phase-out for equipment and vehicles that become available for use after 2023. A taxpayer would be able to claim the enhanced allowance in respect of an eligible zero-emission automotive equipment or vehicle only for the taxation year in which the vehicle first becomes available for use.
For taxation years 2020 to 2023 : rate = 100%
For taxation years 2024 to 2025 : rate = 75%
For taxation years 2026 to 2027 : rate = 55%
For taxation years 2028 and following : N/ACCA would be deductible on any remaining balances in Class 56 on a declining-balance basis at a rate of 30%. An election would be available to forgo Class 56 treatment and instead include property in the Class in which it would otherwise be eligible.
Use this option to enter a property that is part of a CCUS project of a taxpayer and that is
- (a) equipment that is not required for hydrogen production, natural gas processing or acid gas injection and that
- (i) is to be used solely for capturing carbon dioxide
- (A) that would otherwise be released into the atmosphere, or
- (B) directly from the ambient air,
- (ii) prepares or compresses captured carbon for transportation, or,
- (iii) is power or heat production equipment that solely supports the CCUS process,
- (b) equipment that is to be used solely for transportation of captured carbon,
- (c) equipment that is to be used solely for storage of captured carbon in a geological formation (other than for enhanced oil recovery),
- (d) monitoring and control equipment that is to be used solely for the functioning of any equipment described in paragraphs (a) to (c),
- (e) a building or other structure all or substantially all of which is used, or to be used, for the installation or operation of equipment described in paragraphs (a) to (d), or
- (f) property that is used solely to
- (i) convert another property that would not otherwise be described in any of paragraphs (a) to (e) if the conversion causes the other property to satisfy the description under any of paragraphs (a) to (e), or
- (ii) refurbish property described in any of paragraphs (a) to (e).
Use this option to enter a property that is part of a CCUS project of a taxpayer, and that is
- (a) equipment to be used solely for using carbon dioxide in industrial production (including for enhanced oil recovery),
- (b) monitoring and control equipment to be used solely for the functioning of equipment included in paragraph (a),
- (c) a building or other structure all or substantially all of which is used, or to be used, for the installation or operation of equipment described in paragraph (a) or (b), or
- (d) property that is used solely to
ÿ
- (i) convert another property that would not otherwise be described in any of paragraphs (a) to (e) if the conversion causes the other property to satisfy the description under any of paragraphs (a) to (c), or
- (ii) refurbish property described in any of paragraphs (a) to (c).
Use this option to enter a property that is an expenditure incurred by the taxpayer after 2021 and that is
- (a) for the purpose of determining the existence, location, extent or quality of a geological formation to permanently store captured carbon (other than for enhanced oil recovery) in Canada, including such an expense that is
- (i) a geological, geophysical or geochemical expense, or
- (ii) an expense for environmental studies or community consultations, including studies or consultations that are undertaken to obtain a right, licence or privilege for the purpose of determining the existence, location, extent or quality of a geological formation to permanently store captured carbon (other than for enhanced oil recovery); and
- (b) an expense other than an expense
- (i) incurred in drilling or completing an oil or gas well or in building a temporary access road to, or preparing a site in respect of, any such well, or
- (ii) described in Class 60.
Use this option to enter a property that is an expenditure incurred after 2021 by the taxpayer in
- (a) drilling or converting a well in Canada for the permanent storage of captured carbon (other than for enhanced oil recovery),
- (b) drilling or completing a well for the permanent storage of captured carbon (other than for enhanced oil recovery) in Canada, building a temporary access road to the well or preparing a site in respect of the well, or
- (c) drilling or converting a well in Canada for the purposes of monitoring pressure changes or other phenomena in captured carbon permanently stored in a geological formation (other than for enhanced oil recovery).
Use this option to enter a timber limit or a right to cut timber from a limit. The allowance (CCA) is generally established on the basis of the quantity of timber cut in the year versus the quantity of timber which the taxpayer has a right to cut. The CRA discusses this deduction and provides guidelines with respect to the tax treatment of timber limits in Interpretation Bulletin IT-481 (Consolidated).Rate: Depletion allowance applies. Enter the rate to be used in the Timber-Rate keyword in this group.
Land (non depreciable property) can be entered here or in the Capital-Gains group. If the land is entered here, it will print on the CCA schedule but no capital cost allowance, recapture or terminal loss will be calculated on the land.
See the Taxnet Pro™ T1 Line-by-Line Guide (subscription required):
Line 41200 - Investment tax credit (T2038(IND))
Line 45400 - Refund of investment tax credit (T2038(IND))
See the CRA's general income tax guide:
Line 45355 - Multigenerational home renovation tax credit (MHRTC)
RelatedEmployer
Apprenticeship Job Creation Tax CreditIf the apprentice is also employed by another employer related to you (as defined under subsection 251(2)), has it been agreed in writing with all of those related taxpayers, that you are the only employer who will be claiming the apprenticeship job creation tax credit for this tax year for each apprentice whose contract number (or social insurance number (SIN) or name) appears on the list ? (If not, you cannot claim the tax credit.) .
The following options are applicable for the keyword RelatedEmployer.
- Apprentice is not employed by employer related to you
- Employer related - who will not be claiming the tax credit
- Employer related - who will be claiming the tax credit
ContractNumber.i
For each apprentice in their first 24 months of the apprenticeship, enter the apprenticeship contract number registered with Canada, or a province or territory of Canada, under an apprenticeship program designed to certify or license individuals in the trade. If there is no contract number, enter the SIN or the name of the eligible apprentice.
Elig-Trade.itc
Enter the name of the eligible trade and the eligible salary and wages payable (net of any government or non-government assistance received or to be received in respect of eligible salary and wages) in the year in respect of employment after May 1, 2006.
Descript.itc
Use the keyword Descript.itc to enter a description of property or expenditure eligible for an investment tax credit.
See the Taxnet Pro™ T1 Line-by-Line Guide (subscription required):
Line 41200 - Investment tax credit (T2038(IND))
Line 45400 - Refund of investment tax credit (T2038(IND))
See the CRA's general income tax guide:
Line 45355 - Multigenerational home renovation tax credit (MHRTC)
DateAcqu.itc
Use the keyword DateAcqu.itc to enter the date of acquisition of the property eligible for the investment tax credit.
The property must have been acquired in the current tax year.
See the Taxnet Pro™ T1 Line-by-Line Guide (subscription required):
Line 41200 - Investment tax credit (T2038(IND))
Line 45400 - Refund of investment tax credit (T2038(IND))
See the CRA's general income tax guide:
Line 45355 - Multigenerational home renovation tax credit (MHRTC)
Location.itc
Use the keyword Location.itc to specify the location of the property.
Amount.itc
Use the keyword Amount.itc to enter the amount of investment or expenditure for ITC purposes.
ChildCareSpaces
Enter the total number of child care spaces created.
QuebecR&Dcr
Amount of Quebec tax credit for scientific research and experimental development tant can be claimed on line 462 of the Quebec tax return.
ITC-Limit
Use the keyword ITC-Limit to limit current-year credit claim (column 6 or 7 of form T2038(IND).
See the Taxnet Pro™ T1 Line-by-Line Guide (subscription required):
Line 41200 - Investment tax credit (T2038(IND))
Line 45400 - Refund of investment tax credit (T2038(IND))
See the CRA's general income tax guide:
Line 45355 - Multigenerational home renovation tax credit (MHRTC)
ITC-Claimed
Use the keyword ITC-Claimed to recapture the ITC claimed for child care spaces. If, at any time within 60 months of creating a new child care space, that space is no longer available or is converted to another use, the ITC will be recovered for that space or property
The following options are applicable for the keyword ITC-Claimed.
- Child care spaces
- Property for other than child care spaces
Proceeds-or-FMV
Use the keyword Proceeds-or-FMV to enter the proceeds of disposition of the eligible property or the fair market value if disposed of to a non-arm's length party. DT Max will calculate 25% of this amount and enter it on line 6 of Part C of form T2038.
ITC-CB
Use the keyword ITC-CB to enter the year to which the ITC should be carried back.The following options are applicable for the keyword ITC-CB.
Amount.itcb
Use the keyword Amount.itcb to enter the amount of investment tax credit to carry back.
ITC-CF
Use the keyword ITC-CF for new clients when entering the amount of investment tax credit to carry forward into the current year, and the year of reference.In future years DT Max will carry this amount automatically.
The following options are applicable for the keyword ITC-CF.
See the Taxnet Pro™ T1 Line-by-Line Guide (subscription required):
Line 41200 - Investment tax credit (T2038(IND))
Amount.itcf
Use the keyword Amount.itcf to enter the amount of investment tax credit to be carried forward into the current year. The following options are applicable for the keyword Amount.itcf.
- Unclaimed refundable credit
- Unclaimed non-refundable credit (code 5)