Quebec Additional Deduction for the Purchase of Computer Hardware and Manufacturing & Processing (“M&P”) Equipment Purchases

The CCA system provides for a declining-balance CCA rate of 55% (Class 50) on computer hardware and 50% (Class 53) on M&P equipment, both subject to the ½-year rule.

In his budgets released on March 28, 2017 and March 27, 2018, Quebec Minister of Finance and the Economy Carlos Leitão introduced an additional deduction available on such equipment purchased from March 29, 2017 through March 31, 2020, on the conditions that the equipment is new (not used), for use mainly in Quebec for a period of at least 730 days, and is put to use within a reasonable time of its acquisition.  Should these conditions be met, the business will be entitled, for Quebec purposes only, to:

• an additional deduction of 35% of the otherwise allowable CCA deduction for the year, and this, for the year of acquisition and the following year only, for assets purchased between March 29, 2017 and March 27, 2018, and;
• an additional deduction of 60% of the otherwise allowable CCA deduction for the year, and this, for the year of acquisition and the following year only, for assets purchased between March 28, 2018 and March 31, 2020. 

Please consult your Crowe BGK advisor if you have any questions or need assistance in determining whether your business is eligible for this special Quebec treatment.

About the Author:

Sam Lackman, CPA, CA, is a Senior Tax Manager at Crowe BGK.

Connect with him: [email protected]