The Three-Way Split
| Class | Rate | What Lands Here | 2026 Cost Limit |
|---|---|---|---|
| 10 | 30% | Vans, trucks, and passenger vehicles at or under the ceiling | None / $39,000 |
| 10.1 | 30% | Passenger vehicles over the ceiling | Capped at $39,000 |
| 54 | 30%* | Zero-emission vehicles | Capped at $61,000 |
*Class 54's base rate is 30%, but vehicles acquired 2025–2029 currently qualify for a 100% first-year write-off. Ceilings are before tax, per Finance Canada's January 14, 2026 announcement. Taxis, rental vehicles, and freight trucks over 11,788 kg have their own class — 16, at 40%.
Three Vehicles, Three Very Different Deductions
All bought in 2026, all used 100% for business:
| Vehicle | Price | Class | Depreciable Base | Year-One CCA |
|---|---|---|---|---|
| Cargo van | $35,000 | 10 | $35,000.00 | $15,750.00 |
| Luxury SUV | $95,000 | 10.1 | $39,000.00 | $17,550.00 |
| Electric sedan | $70,000 | 54 | $61,000.00 | $61,000.00 |
The van and the SUV both claim 45% of their base in year one (30% × 1.5 under the RIIP). The difference: the SUV's base is capped. Of its $95,000 price, $56,000 will never be deductible — not this year, not ever. The electric sedan writes off its full capped base immediately.
Why Class 10.1 Is Its Own Little World
Parliament built Class 10.1 to stop luxury cars from becoming tax shelters, and gave it rules no other class has:
- One vehicle per pool. Every 10.1 vehicle is tracked separately — no pooling with anything else.
- Cost capped at the ceiling — $39,000 for 2026 acquisitions. The excess is permanently non-deductible.
- No recapture, no terminal loss. Sell high or sell low; the tax result is the same.
- Half CCA in the disposal year — the only class that allows any claim on an asset in the year you sell it.
The ceiling moves almost every January — it was $30,000 as recently as 2021. Our CCA guide has the year-by-year table.
Vehicle Gotchas
- Business-use percentage prorates everything. A vehicle driven 70% for business claims 70% of the CCA. The evidence is your mileage log.
- The cap is per vehicle, decided at purchase. A $40,000 car bought in 2025 (when the ceiling was $38,000) stays a 10.1 vehicle even though the 2026 ceiling rose to $39,000.
- Some pickups escape the cap entirely. Used primarily for hauling goods or equipment, a pickup can be a "motor vehicle" rather than a "passenger vehicle" — full cost, Class 10. The definitional tests are precise; get them checked.
- Leasing is a different regime. Lease payments have their own deduction limits ($1,100/month for 2026 leases) — CCA doesn't apply to a vehicle you don't own.
Vehicle CCA Questions
Model your vehicle purchase
The free CCA calculator applies the caps and the 2026 first-year rules for Classes 10, 10.1, and 54.
Ceilings and first-year rules verified against Finance Canada's 2026 automobile deduction limits (announced January 14, 2026) and Bill C-15, as of July 22, 2026. Passenger-vehicle definitions have precise statutory tests this page summarizes — confirm your vehicle's class with your accountant before filing.