Thank you everyone for your replies - truly appreciate it and grateful.
I have a similar situation but the vehicle is 10 years old! I have a new client who purchased a truck in 2010 and used it exclusively for his business. He was having his tax returns done by HR block for the last 10 years and they did not set up the asset or take CCA. Only his fuel and maintenance fees were deducted all those years.
Since the truck has always been used for business, I believe I can set it up at the original cost but using the 2010 purchase date. Am I wrong?
Although you would likely win if the client was audited or reviewed, you may have a bit of a fight on your hands.
Technically speaking; if the client chose not to claim CCA on his vehicle (which was within his right to do so), he would have still set the vehicle up as an addition on his CCA schedule in 2010 and claimed zero CCA each year. I believe fixed asset âadditionsâ do get transmitted to the CRA each year along with the T1, so I donât think you can just enter an opening UCC balance and start deducting CCA if an addition has never been reported⌠but I donât know how good their system is at catching these types of irregularities.
I would not be afraid to do what you are suggesting @Versa; it was purchased for $xx in 2010 with no depreciation recorded so the entire purchase price is available for depreciation. Just make sure you have proof of purchase in 2010 available if required.
For the software to recognize and produce an amount for the asset in the Additions cell it would have to have an acquisition date in the current year.
Using an acquisition date from a previous year will result in no amount being produced in the Additions cell even when entering an amount in the Cost cell.
Or are you suggesting entering the original acquisition date and do an override to the Additions cell manually entering the cost?
Currently, I have the original date entered (previous year) with the full cost entered in the UCC cell.
My thoughts again with a bit more of an explanation.
So vehicle was used in business - expenses prorated other than CCA - not entered.
If it had been entered the CCA claimed would have been the prorated business portion and the ending UCC would have been less the total of both the the business and personal portions of CCA.
That is the approach I would still go with.
100 % business vehicle different story.
@NiceGuy This is my first year using Taxcycle. So at the very top of the motor vehicle worksheet, I have entered the Make/Model/Year/Date Acquired/KM driven, using the original date. Then further down on the worksheet in the CCA section I put the original cost of $21,000 in the opening UCC field. It seems to work fine.
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I believe the motor vehicle section works differently from the regular Asset worksheet.
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