Immediate Expensing Rules: Good Tax Policy?

Over the course of the last two federal budgets (April 16, 2024 and November 4, 2025), the rules for claiming Capital Cost Allowance (CCA) have been uncertain. The proposal to extend immediate expensing rules for certain acquired assets were paused for over a year and then re-introduced in a series of four complex measures which together with new rules for Scientific Research and Experimental Development have become known as the “Productivity Super-Deduction”.  A backdrop appears below. The key question: will this complexity be effective as an economic stimulator?   

As DAC 2016 wraps up in beautiful San Diego, CA, we are excited to announce the site of the 2017 DAC:  beautiful Kelowna, BC, where we will celebrate Canada’s 150th birthday November 5-8.  Reserve now at special pre-conference early bird rates.

Largely due to advances in preventing heart disease and with Baby Boomers leading healthier lifestyles, Canadians who reach age 65 are more likely than ever to live into their 90's.  This takes retirement income planning into a much longer period, in which a focus on continued accumulation and investing is as important as tax-efficient withdrawal of funds.  Capital must be preserved at the same time.

"You learn far more from negative leadership than from positive leadership. Because you learn how not to do it. And, therefore, you learn how to do it."  Norman Schwarzkopf

Year end is a great time to re-engage clients in conversation about financial decision-making, especially for clients with offshore assets who may need to report some of them on Form T1135 Foreign Income Verification.

For several years now, the prescribed interest rate applied to spousal loans has been set at 1%, but that could change if interest rates rise in 2017. Are you taking advantage of the opportunity to transfer capital to a spouse with a bona fide loan at the current low interest rate?

Knowledge Bureau Report’s monthly poll for October asked: “In your opinion is the new Canada Child Benefit (CCB) better than the combo of UCCB, Child Tax Benefit and Family Tax Cut?”  The results were almost evenly split: 52% voted yes and 48% voted no.