CRA notes that transferring Class 14.1 property under s. 85(1) eliminates any additional Reg. 1100(1)(c.1)(i) CCA claims

Regarding where a taxpayer acquired Class 14.1 property after 2016 pursuant to a s. 85 rollover, CRA noted that, for taxation years ending before 2027, Reg. 1100(1)(c.1)(i) allows a claim of additional CCA of 2% on a portion of the undepreciated capital cost of Class 14.1 property of the taxpayer at the beginning of January 1, 2017. CRA effectively noted that there is no continuity rule regarding the transfer of the Class 14.1 property under a s. 85 rollover to a subsidiary or other taxpayer, so that such a transfer would result in the loss of the additional CCA claims.

Neal Armstrong. Summary of 8 March 2023 External T.I. 2017-0729871E5 F under Reg. 1100(1)(c.1)(i).