Hi,
I'm having trouble with figuring out the " Unclaimed capital cost (UCC) at the beginning of 2023" my vehicle.
I used my car for self-employment 2017- 2021
Purchased new in 2017
UCC at beginning of 2021: 9,183.83
CCA for 2021 return: 2,259.19
For year 2022 the business had no income or expenses and there was no
"Motor vehicle expense (Business)" section of the return.
For 2023, I had a separate business in which I used my vehicle for business purposes. How do I accurately calculate my UCC for the beginning of 2023?
Also, I had two businesses in which I used my car, would I enter the same UCC value for both when I log the expenses?
Your assistance is appreciated 🙂
UCC is the balance of the capital cost left for further depreciation at any given time. If you have claimed Capital Cost Allowance (CCA) in the past on your vehicle used for Business or Employment, you will have a number left at the end of the year known as Undepreciated Capital Cost or UCC.
UCC at beginning of 2021: 9,183.83
CCA for 2021 return: 2,259.19
UCC end of 2021: = 9,183.83 - 2,259.19 = 6,924.64
UCC for 2022:
Since you had no business income or expenses in 2022, you didn't claim any CCA for 2022.
Therefore, the UCC at the end of 2022 remains the same as at the end of 2021 = $6,924.64
UCC at the beginning of 2023:
The UCC at the beginning of 2023 is the same as the UCC at the end of 2022 = $6,924.64
You do not enter the same UCC value for both businesses. Instead, you should determine the percentage of business use for each business and allocate the UCC accordingly.
For example: Assume Business A uses the car 60% of the time, and Business B uses it 40% of the time. Allocate UCC based on usage:
For Business A: 60% of $6,924.64 = $4,154.78
For Business B: 40% of $6,924.64 = $2,769.86
Thank you for choosing TurboTax.
Thank you for your insight.
Originally I thought the same calculation of UCC-CCA = UCC Start of next year. But when comparing 2019, 2020 & 2021 returns the values are as follows:
Year 2019
UCC at beginning of the year: 18,742.50
CCA: 5,370.47
UCC-CCA = 18,742.50 - 5,370.47 = 13,372.03 [Should be UCC for beginning of 2020]
(notice the 252.28 deviance)
Year 2020
UCC at beginning of the year: 13,119.75
CCA: 3,306.00
UCC-CCA = 13,119.75 - 3,306.00 = 9,813.75 [should be UCC for 2022 & 2023] But instead UCC was populated as 9,183.83. [629.92 deviance]
So, just wondering what might be causing these deviances in the calculation. These differences in value were what made me think twice about the UCC-CCA = Next year UCC.
Appreciate your insight & suggestions.