What happens with cca assets last year of business (ie. retirement)?

[Delphision · Accepted solution]

You will have to enter the disposal at the market value at the time of the business closure.  Check on the internet for approximate values and use that as the market value.  Print or copy support for the costs in case CRA calls in some support. You will use the UCC at the beginning.  Put the additional $2,000 in additions, and below show the proceeds in the disposal section.  I suggest giving CRA a phone call as the software might not be following the CCA rule on disposing of all assets in a class as per the link below. 1-800-959-8281.  If you have claimed GST/HST on these assets, you will have to self-assess the difference between the proceeds and the original purchase and remit it back.

http://www.cra-arc.gc.ca/tx/bsnss/tpcs/slprtnr/rprtng/t2125/cl5-eng.html

[prmathieson]

This makes perfect sense but... Turbotax is still treating the disposition minus the additions as a capital gain. Is this right?

[MamaK]

You must dispose of them to yourself for their Fair Market Value at the time you stopped operating your business, if you have not sold them to others.  This goes on the CCA schedule on the T2125 form.

[prmathieson]

I have a similar question. I closed my business early in 2015. At the start of the year I had a carry forward for class 12 assets.(50k)  Before closing I added to that class (2k) and then disposed of the entire class assets at closing (20k). When I enter the info in turbo tax it creates a capital gain of 18k and then claims the cca carryforward of 50k separately. Is this correct or should I enter the disposition as a loss of 28k? And how do I do that?