Column 5 - Undepreciated capital cost (UCC) after additions and dispositions

You cannot claim capital cost allowance (CCA) when the amount in column 5 is:

• negative (see "Recapture of CCA " below); or
• positive, and you do not have any property left in that class at the end of the fiscal period (see "Terminal loss" below).

In either case, enter "0" in Column 10 -UCC at the end of the year.

Recapture of CCA

If the amount in column 5 is negative, you have a recapture of CCA. Include your recapture on line 8230, "other income", in Part 3 of Form T2125, Statement of Business or Professional Activities.

A recapture of CCA can happen if the proceeds from the sale of depreciable property are more than the total of:

• the undepreciated capital cost (UCC) of the class at the start of the period; and
• the capital cost of any new additions during the period.

A recapture of CCA can also occur, for example, when you get a government grant, or claim an investment tax credit.

In some cases, you may be able to postpone a recapture of CCA. For example, you may sell a property and replace it with a similar one, someone may expropriate your property, or you may transfer property to a corporation or a partnership.

Terminal loss

If the amount in column 5 is positive, and you no longer own any property in that class, you may have a terminal loss. More precisely, you may have a terminal loss when, at the end of a fiscal period, you have no more property in the class but still have an amount which you have not deducted as CCA.

You can usually subtract this terminal loss from your gross business or professional income in the year you disposed of the property. Enter your terminal loss on line 9270 - Other expenses, in Part 5 of Form T2125.

Forms and Publications

• Guide T4002, Business and Professional Income
• Form T2125, Statement of Business or Professional Activities
• Interpretation Bulletin IT-478, Capital Cost Allowance - Recapture and Terminal Loss

Related Topics

• Class 10.1 (30%)

Date modified:

2017-01-03