Does the CCA you claim on a vehicle still fall subject to the business use percentage of said vehicle for the final amount you can use as an expense?

I have a UCC of 28,815 for class 10.1 small business vehicle.

Turbo tax automatically calculated a max CCA of 3,057.87 for this vehicle.

I found this odd considering 30% of the UCC would actually be 8644.50, and when I tried to adjust the value higher, it was telling me it can't be higher because it needs to be 30% of UCC.

When I checked my carry forward for next year the value for this vehicle was 20,170.48 which is the correct number if I was to use the full 30% for CCA, however there was nowhere I entered or could see 8644.50 on any forms.

I discovered that the 8644.50 was being subjected to the "business use part" of the vehicle which is 35.3735%, bringing it down to the 3,057.87 for the value actually entered in the text box for this vehicle.

Maybe I'm just not used to 10.1 class calculations, but I was almost sure turbo tax was doing an incorrect calculation until I figured it out, and if the calculations are correct, they sure do have a confusing way of displaying the information.

I had a class 10 vehicle up until the end of 2017 and it was never this confusing. I entered the CCA I wanted to use, was able to see it and it was then removed from the UCC.

My question is, is this correct??? Does the CCA for this vehicle actually get subjected to the business use percentage?

After examining my return from last year, it appears the same calculation was done, except some simple math on the tax forms do not add up for this vehicle. It shows the CCA for the year as the value after being subject to business use percentage, but the final UCC calculation is done as if the full 30% was shown, so a simple column 5 (minus) column 9 does not equal column 10, based on the numbers actually on the form. (all done by Turbo Tax)

The values in the end are ok, but when the CCA for the year is cut down by the business use part, I'm afraid I've been short changed on expenses.

I know this is kind of a long confusing delve into some specific things, but any help is appreciated!!

2219

1 Best answer

Level 15

Oct 31, 2019 1:48:39 AM

Although this may seem confusing, the calculation is correct. One way to look at it is:

The amount of CCA you are allowed to claim each year on a Class 10.1 vehicle is 30%. (30% of 28,815 = 8,644.50)
You must further prorate this by the kms used for business use. (35.3735% of 8,644.50 = 3,057.87)
Your UCC amount will decrease by the full amount of CCA you can claim each year, not the percentage used for business. (28,815 - 8,644.50 = 20,170.50)

Level 15

Oct 31, 2019 1:48:39 AM

Although this may seem confusing, the calculation is correct. One way to look at it is:

The amount of CCA you are allowed to claim each year on a Class 10.1 vehicle is 30%. (30% of 28,815 = 8,644.50)
You must further prorate this by the kms used for business use. (35.3735% of 8,644.50 = 3,057.87)
Your UCC amount will decrease by the full amount of CCA you can claim each year, not the percentage used for business. (28,815 - 8,644.50 = 20,170.50)

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Does the CCA you claim on a vehicle still fall subject to the business use percentage of said vehicle for the final amount you can use as an expense?