Can I Claim Equipment and Computer Hardware as a Business Expense in Canada?
Yes, deductible via Capital Cost Allowance (CCA). General-purpose computer hardware and systems software bought after 18 March 2007 fall into Class 50 at 55% declining balance. Office furniture and equipment cost CAD 500 or more fall into Class 8 at 20%. The half-year rule limits the first-year deduction to 50% of normal CCA. Check current CRA guidance on any temporary immediate expensing rules.
Finn does your books in Canada
AccountsOS keeps the books for Canada businesses, tracks tax deadlines and handles expenses, in plain English. Ask Finn about yours, no signup needed.
What Canada Revenue Agency (CRA) says
CRA prescribes CCA classes under Schedule II of the Income Tax Regulations. General-purpose computer hardware and systems software acquired after 18 March 2007 are in Class 50 (55%). Furniture, appliances, machinery and tools costing CAD 500 or more each are in Class 8 (20%). Tools and instruments costing less than CAD 500 and non-systems software are in Class 12 at 100%, with the half-year rule applying to software. Class 10 (30%) covers older computer hardware and motor vehicles. The Accelerated Investment Incentive and immediate expensing rules changed first-year deductions for property acquired between 2018 and 2024, so check the status for property acquired now.
When you can claim
- Class 50 (55%): laptops, desktops and general-purpose computer hardware and systems software
- Class 8 (20%): office furniture, photocopiers, scanners, printers, and general business equipment costing CAD 500 or more each
- Class 12 (100%): tools and equipment costing under CAD 500 each, and non-systems software, with the half-year rule applying to software
- Immediate expensing (if still available for the acquisition year): a 100% first-year deduction for eligible CCPCs on designated property
When you cannot claim
- Personal computers or devices not used for business (or only the personal-use portion)
- Capital cost above the class ceiling for restricted assets
- Software or equipment purchased for personal use and occasionally used for work
Good to know
Pro tip: CCA is discretionary, so you do not have to claim the maximum each year. In a loss year you can skip the claim and keep the undepreciated cost for later years when you have taxable income to shelter. Keep the purchase invoice and note the CCA class on the asset register.
Stop guessing what you can claim in Canada
AccountsOS automatically categorises expenses with Canada Revenue Agency (CRA)-aware rules and tells you exactly what is claimable.
Try Free