Who this is for
Owner operators and trucking companies in BC buying a tractor, a trailer or a straight truck. Also those buying a pickup for the business, or a car for the owner.
Five things to know
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It is a proposal. Announced September 15, 2026 as draft legislation. The details can change before it becomes law. Until then, the existing capital cost allowance rules apply, including the enhanced first-year deduction under the Accelerated Investment Incentive where it still applies.
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The date is acquisition on or after September 15, 2026, and the year is the one in which the property becomes available for use. A truck ordered in August and delivered in October is acquired in October. Delivery and being ready to work decide the year.
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Heavy equipment is in; some vehicles are not. The announcement excludes certain vehicles in classes 10 and 10.1. Class 10.1 is passenger vehicles over the cost threshold; class 10 includes other automotive equipment. Trucks and trailers used in a trucking business are generally in other classes. The exact class of what you are buying decides the answer, and that is checked per purchase.
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Financing does not change the deduction. A financed truck is deducted the same way as a cash one; the interest is a separate expense. Cash flow is what financing changes.
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A deduction is not a cheque. The tax saved is the cost times the rate, only if there is income. And if the corporation is a personal services business, operating expenses against that income are restricted. Our trucking update explains the PSB rules.
One thing many people do not realize
A deduction only helps if there is income to apply it against. A trucking corporation that is a personal services business may not be able to deduct the vehicle at all against that income. Two separate rules, the write-off proposal and the PSB rules, can collide on the same purchase. Settle the PSB question first.
What to prepare
- The quote or purchase agreement, with the expected delivery date
- Whether it is new or used, financed or leased
- Your fiscal year end
- Last year’s return
- How the business is set up: sole proprietor, corporation, and who the main customers are
When professional help may make sense
Any purchase over a few thousand dollars close to year end, any vehicle that is partly personal, and any corporation with one main carrier customer.
How Rex Tax may be able to help
We prepare returns for trucking businesses and set the capital cost treatment per asset. We tell you when the proposal passes and what it means for purchases already made.
Official sources
- Department of Finance news release, September 15, 2026: Productivity Mega Deduction
- CRA: Classes of depreciable property
This guide is general information, not advice about your situation. It reflects the rules for the 2026 tax year. Rules described are those in effect from September 15, 2026. It has not yet been reviewed by a practitioner. The information was checked against the official sources listed above on the date shown. Rules change. Check the official sources above or ask us. How we prepare these guides.