Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: To determine the CCA class for a printer purchased after March 22, 2004.
Position: A printer can be considered data processing equipment that is ancillary to general-purpose electronic data processing equipment pursuant to the proposed amendments in the Income Tax Regulations. The printer, if acquired after March 22, 2004 and not acquired before 2005 in respect of which an election is made under subsection 1101(5q) of the Regulations, will be included in the new Class 45 with a 45% CCA rate.
Reasons: Class 10(f), Class 45, Proposed Amendments
2005-011233
XXXXXXXXXX Luisa A. Majerus, CA
(613) 957-2138
February 22, 2005
Dear XXXXXXXXXX:
Re: Classification of a Printer
This is in response to your email of January 19, 2005, wherein you requested our comments regarding the proper classification of a printer purchased after March 22, 2004, in Schedule II to the Income Tax Regulations (the "Regulations").
Written confirmation of the tax implications inherent in particular transactions is given by this Directorate only where the transactions are proposed and are the subject matter of an advance income tax ruling request submitted in the manner set out in Information Circular 70-6R5, Advance Income Tax Rulings, dated May 17, 2002. Where the particular transactions are completed, the inquiry should be addressed to the relevant Tax Services Office. However, we offer the following general comments.
Schedule II of the Regulations lists the various capital cost allowance ("CCA") classes and the applicable rates of depreciation for capital property. Paragraph (i) of Class 8 includes all tangible capital property that is not included in another class in Schedule II of the Regulations (20% CCA rate). Paragraph (f) of Class 10 includes "general-purpose electronic data processing equipment and systems software therefor, including ancillary data processing equipment, acquired after May 25, 1976". Proposed amendments to Schedule II of the Regulations introduces a new class, Class 45, which includes property purchased after March 22, 2004 that is general-purpose electronic data processing equipment and systems software therefor, including ancillary data processing equipment.
Generally, a printer that is connected to a computer can be considered data processing equipment that is ancillary to general-purpose data processing equipment. Accordingly,
provided the amendments, as noted above, to Schedule II of the Regulations are made, it is our view that a printer can be included in Class 45 at a 45% CCA rate provided the printer is purchased after March 22, 2004 and was not acquired before 2005 in respect of which an election is made under subsection 1101(5q) of the Regulations.
We trust this information meets your needs at the current time.
Yours truly,
John Oulton, CA
For Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Planning Branch
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