Should I claim depreciation on my rental property this year?

Arsen Accounting Services · Question 152 · Sources checked October 29, 2026

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Capital cost allowance can reduce current rental income, but claiming the maximum is not automatically the best choice. It can affect future deductions and create recapture when the property is sold. Review both the current benefit and the longer-term consequences.

Understand the choice and limitation

CRA allows a claim from zero up to the permitted maximum. CCA generally cannot create or increase a rental loss. Where you own more than one rental, the overall rental-income calculation matters before determining the available claim.

The property class, acquisition date, available-for-use rules, and other limits affect the maximum. Land is not included in a building's depreciable amount. Short-term rental compliance restrictions may also affect the claim.

Official guidance: [1], [2].

Compare two projections

For example, a landlord expecting to sell soon may want to compare current tax savings with the potential sale-year recapture. Another landlord may have no current tax payable, making the immediate benefit less useful. These are reasons to model the decision rather than use a default setting.

Prepare the calculation inputs

• Current rental income and expenses for all properties.
• Prior CCA and undepreciated-cost schedules.
• Expected holding period and possible sale plans.
• Capital additions, disposals, and changes in use.

Ask the preparer to show the return with and without the proposed claim. Keep the chosen amount and rationale in the annual file. If the property was formerly your home or may become your home, flag that before claiming CCA because principal-residence and change-of-use issues can affect the wider decision.