The Capital Cost Allowance (CCA) system determines how much of the cost of a capital asset a business may deduct each year for tax
purposes. Budget 2009 proposes a temporary 100-per-cent CCA rate for computer hardware and systems software acquired after January 27, 2009 and before February 1, 2011. In addition, the rule that restricts CCA deductions to one-half of the CCA write-off otherwise available in the first year will not apply to these computers.

This temporary measure will allow taxpayers to fully expense their investment in computers in one year and claim it when filing their 2009 tax return. Businesses in all sectors of the economy, including the service sector, can benefit from this incentive.