CCA and asset forms
In TaxCycle T1/TP1, capital cost allowance (CCA) and asset forms become available as soon as you start a related business or income statement. For example, when you create a T2125, TaxCycle creates the connected CCA and asset forms. These include:
- CCA worksheet (T2125CCA, T2042CCA, T776CCA, etc.), the standard CCA schedule.
- Asset Manager (T2125Asset, T2042Asset, T776Asset, etc.), where you can track assets in detail.
- CCAClaim (T2125CCAClaim, T2042CCAClaim, T776CCAClaim, etc.), where you can set the order in which you want to claim the CCA properties.
- Asset Summary (T2125AssetSummary, T2042AssetSummary, T776AssetSummary, etc.), a summary page of the assets entered in the return.
For simple CCA claims, you may wish to enter the values directly on the CCA worksheet. For clients with many assets, you can track acquisitions, dispositions and classes on the detailed Asset Manager. The amounts flow between the two.
For Motor Vehicle CCA, use the Motor Vehicle worksheet. This information flows into the related CCA Worksheet. Learn more in the Motor Vehicle Expenses help topic.
In TaxCycle T2, these forms are built around CCA Schedule 8. Learn more on the T2 Schedule 8 CCA and Assets help page.
- If you enter CCA and assets on the CCA worksheet (such as the T2125CCA), use one row in Part 11 for each CCA class or pool.
- As you complete a row, TaxCycle adds a new blank row to the bottom of the table.
- If you carried forward the return, the class number and undepreciated capital cost (UCC) will appear in the applicable column.
- Information in this table flows through to the related Asset Manager. Double click on a row to jump to the related page and field on the Asset Manager. Or click on the blue link in the table heading.
- CCA claimed on motor vehicles flows into the bottom of this table from the Motor Vehicle worksheet.
- Enter current-year additions and dispositions on page 2. These amounts flow back to the table at the top of the page.
- Columns 4, 7 and 8 apply to accelerated investment incentive properties (AIIP) that became available for use during the year. If you enter additions on this form, you will still be required to go to the Asset Manager to enter the transaction date in order to calculate the accelerated CCA if applicable.
Asset Managers shows one CCA or asset record per page. If you entered CCA details directly on the CCA worksheet, TaxCycle creates a separate page for each row in the table in on the CCA worksheet.
- Click the arrows in the toolbar at the top of the form to move between asset records.
- Select a record from the drop-down menu to open it.
- Click Delete Asset to remove an asset from the manager. (You can recover this by using Ctrl+Z to undo, or by viewing the deleted items in the Prepare sidebar.)
- Click Show Asset to open the related item in DoxCycle (if applicable).
- To create a new asset record, click New Asset.
- Enter a Description.
- Type the class number. TaxCycle automatically adds a letter to the end of each CCA class to allow you to pool or separate assets as required (see below).
- Further down the worksheet, enter details of any additions or disposition. When you start a new section in the Current Year Addition/Disposition Transactions section, a new blank one is created, so you can add as many as you need.
- For each addition or disposition, enter the percent that is Personal portion, if applicable.
- For additions, a transaction date is required to determine whether the additions is eligible for accelerated CCA as Accelerated Investment Incentive Property (AIIP). (To learn more about Accelerated CCA rules and calculations in TaxCycle T1/TP1, read the Accelerated CCA help topic.)
- If you enter a transaction date that is after November 20, 2018, TaxCycle answers Yes to the AIIP? question. This indicates that the addition is eligible for an accelerated CCA.
- Generally, the half-year rule is suspended for additions eligible for accelerated CCA. This occurs automatically in TaxCycle when calculating the accelerated CCA. DO NOT answer NO to the half-year rule question on the asset manager to achieve this result. Answer the question based on whether the half-year rule would apply in normal circumstances and TaxCycle will take care of the rest.
- The Net addition calculation section shows the detailed calculation of additions and dispositions to that class. When applicable, additional details about accelerated CCA calculations appear in the Accelerated Investment Incentive Property (AIIP) section. Please read the Accelerated CCA help topic for further details on this measure and the calculations in TaxCycle.
- When you enter a disposition, TaxCycle first applies the amount to any Non AIIP additions. If there is a remaining disposition amount, it is then applied to AIIP additions.
- For additional information about the calculations, refer to the Accelerated Investment Incentive Property (AIIP) section which explains the applicable rule and calculation. To collapse/hide or expand/show the notes in the Accelerated Investment Incentive Property (AIIP) section, click the arrow on the far left of the section title.
How to find the right CCA class
- Even before you finish typing all the letters in the word, TaxCycle matches it to the Place your cursor in the Class field.
- Begin typing the description of the capital asset. In this case, start typing spacecraft
- Press Enter.
Pool assets of the same type
Even though you are permitted to pool many assets of the same type, it can become unwieldy to keep track of original costs. And, this eventually makes it difficult to enter disposition. On the Asset Manager, you can create and maintain a separate CCA record for each capital asset and let TaxCycle pool them when reporting to the CCA.
For example, let's enter asset records for three office chair purchases: Dan's chair at a cost of $750, Steven's chair at a cost of $610, Allen's chair at a cost of $679:
- On the Asset Manager, create three separate class 8-a asset entries for the addition of each asset, selecting class 8-a at the top of each record.
- TaxCycle then calculates CCA on a pooling of costs basis for all the assets under the same CCA class and lists the items together on the CCA worksheet. Pool entries appear with green text and you cannot edit them on the CCA worksheet.
Terminal loss for all assets in the same class/pool
To trigger a terminal loss for all of the assets under the same class, make one terminal loss entry under one Asset Manager record for that class/pool:
- Open any one of the records for the same class/pool in Asset Manager.
- Enter the total Proceeds for all assets in that class/pool.
- Enter the total Cost for all assets in that class/pool.
- Answer Yes to the Terminal loss? question.
- TaxCycle calculates the terminal loss of the same class/pool on the CCA worksheet.
Separate CCA assets from the same class
TaxCycle automatically adds a letter to the end of each CCA class, for example 1-a. This allows you to create separate CCA classes for capital assets that you are not permitted to calculate by pooling the cost basis.
For example, if your client has class 1 rental properties costing $50,000 or more, you must create separate classes. Make one entry with class 1-a and one for class 1-b. These will then appear as separate rows on the CCA worksheet and on separate pages on the Asset Manager.
Claim a different CCA amount
If you wish to claim a different CCA amount, set it on the CCA worksheet.
- Open the CCA worksheet.
- Below the table, answer Yes to the Do you wish to claim a different amount? question.
- Enter the amount you wish to claim.
Adjust the CCA claim order
Use the Claim worksheet (such as T2125Claim) to define the order in which to claim CCA from different classes:
- On the CCA worksheet, enter a different amount to claim (see above). For example, $500.
- Go to the Claim worksheet (T2125Claim) choose the order in which to claim the CCA.
- Choose whether to include buildings in these claims.
- At the bottom of the worksheet, the actual CCA claim switches between classes as you change the claim order, while the Total CCA Claim remains at $500.
View and review all asset entries on the Asset Summary (T2125AssetSummary):