A corporation with a June 30 year end begins its operations on January 1 of the current year. It acquires $50,000 of Class 8 assets on March 1. The maximum CCA for its fiscal year ending June 30 of the current year is $15,000.

Question

Quizplus · Accepted Answer

The maximum Capital Cost Allowance (CCA) for Class 8 assets in the first year is calculated at a half-year rate, meaning the corporation can claim only up to half of the applicable CCA rate for the assets acquired in the fiscal year. Class 8 assets typically have a CCA rate of 20%, so for $50,000, the maximum CCA for the fiscal year would be $5,000 (20% of $50,000, then halved for the half-year rule).

A Corporation with a June 30 Year End Begins Its