Personal use of property

If you buy property for both business and personal use, you can calculate the business use of the property.

Example

Jennifer owns a business. She bought a car in 2023 that she uses for both personal and business use. The car cost $20,000, including all charges and taxes. Therefore, she includes the car in Class 10. Her business use this year was 12,000 kilometres of the total 18,000 kilometres driven. She calculates her CCA on the car for 2023 as follows:

Cost of additions = $20,000
CCA rate for Class 10 = 30%
Adjustment for current year additions is $20,000 divided by 2 = $10,000
Base amount for CCA = $10,000
Base amount for CCA $10,000 multiplied by 30% = $3,000
Capital cost amount for the year = $3,000

Since Jennifer used her car partly for personal use, she calculates her CCA for business use as follows:

12,000 (business kilometres) ÷ 18,000 (total kilometres) × $3,000 = $2,000

Jennifer enters $2,000 on line 9936.

Note

The capital cost limits on a Class 10.1 vehicle (a passenger vehicle) still apply when you split the capital cost between business and personal use.

Changing from personal to business use

If you bought a property for personal use and started using it in your business in your current tax year, there is a change in use. You need to determine the capital cost for business purposes at the moment of this change in use.

When you start using your property for business use, you are considered to have disposed of it. If the fair market value (FMV) of the property is more than its cost, you may have a capital gain unless you file an election.