The Canadian government has proposed expanding its 100% expensing to eligible business aircraft acquired on or after September 15. Prime Minister Mark Carney this week unveiled a “productivity mega deduction” measure that would increase the range of assets covered under Canada’s 100% depreciation provision that was included in Budget 2025.
Initially, the 100% depreciation effort covered about 15% of assets, but under the productivity mega deduction, that is expanding to about 65%, including aircraft, along with fiber-optic cable, mining property, oil and gas pipelines, software, research and development, and computer equipment, among others.
Under the productivity mega deduction measure, the aircraft must be ready to fly for the business. If it is still being completed/refurbished at year-end, the deduction will roll over to the year it is ready to use, according to the Canadian Business Aviation Association (CBAA).
The depreciation measure also applies to preowned aircraft, subject to certain rules surrounding previous ownership of the buyer or a non-arm’s-length person.
“This is a significant advocacy win for CBAA and our members,” said CBAA president and CEO Harlan Simpkins. “We consistently strive for policies that drive investments and strengthen Canada’s competitiveness. Including aircraft in the productivity mega deduction is a solid initiative for business aviation opportunities.” He added that CBAA is continuing to monitor implementation of the measure, which must be legislatively approved.
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