Ottawa proposes immediate expensing for most business assets

On 15 September 2026 the Prime Minister and the Department of Finance announced the Productivity Mega Deduction. It would let businesses deduct the full cost of most depreciable property in the year it becomes available for use, instead of spreading it over years through capital cost allowance. The Department of Finance says it would be permanent.

The main points

• Applies to property acquired on or after 15 September 2026 and available for use
• Would lift the share of business investment in capital assets that qualifies from roughly 15% to more than 65%
• Left out: most buildings (classes 1 and 3), franchises, licences and goodwill, and certain vehicles in classes 10 and 10.1
• Assets that do not qualify keep an enhanced first-year deduction under the Accelerated Investment Incentive
• Draft rules limit individuals, and partnerships with individual members, from creating or increasing a loss with it

Draft legislation has been released, and it has to be enacted before anyone can claim under it. The wording can still change. The guide below covers what to record now so that a claim can be made once the law is final.

What it would change, and what to record →