Troubleshooting T22019-004 – Additions and Dispositions Workchart – Incorrect calculation of the proceeds of disposition of property in CCA class 54 for a zero-emission passenger vehicle related to dispositions after July 29, 2019

  • Article Type: Problem Resolution
  • Last Modified: 2019-08-08

Symptoms

When property in class 54 for a zero-emission passenger vehicle is disposed of after July 29, 2019, in the Additions and Dispositions Workchart, the program does not correctly calculate the proceeds of disposition where the acquisition of this vehicle of the corporation is greater than the capital cost limit ($55,000).

Environment

Published in August 2019
Corporate Taxprep Classic 2019 v.1.0
Corporate Taxprep Classic 2019 v.1.1
Corporate Taxprep 2019 v.1.1
CCH iFirm Tax T2 2019 v.1.1
 

Cause

In section 52 of the Legislative Proposals Relating to Income Tax and Other Legislation published on July 30, 2019, the federal Government modified the description of C in the formula in subparagraph 13(7)(i)(ii) ITA by replacing the cost to the taxpayer of the vehicle with the following formula: 

C is the amount determined by the formula:
 
D + (E + F) - (G + H)

where: 

D is the cost to the taxpayer of the vehicle,

E is the amount determined under paragraph 13(7.1)(d) in respect of the vehicle at the time of disposition,

F is the maximum amount determined for C in the definition undepreciated capital cost in subsection 13(21) in respect of the vehicle,

G is the amount determined under paragraph 13(7.1)(f) in respect of the vehicle at the time of disposition, and

H is the maximum amount determined for J in the definition undepreciated capital cost in subsection 13(21) in respect of the vehicle.
 

Resolution

Recalculate the proceeds of disposition of the zero-emission passenger vehicle considering the modifications made to the description of C of the formula in subparagraph13(7)(i)(ii) ITA and enter the result using an override in the field Proceeds of disposition of the Disposition section in the Additions and Dispositions Workchart.

Corporate Taxprep

Schedule 8 WORKCHART ADD

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CCH iFirm Tax T2

Schedule 8ADD

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Additional Information

For more information, read section 52 of the Legislative Proposals Relating to Income Tax and Other Legislation published on July 30, 2019.

Note: You can use the client filter and diagnostic template provided to identify the Corporate Taxprep 2019 files affected by this problem. To learn how to install this template, consult the following article: How to install the client filter and diagnostic template.

This measure will be integrated in Corporate Taxprep 2019 v.2.0 as well as in CCH iFirm Tax T2 2019 v.2.0.
 
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  Attachments
 Solution Id Troubleshooting-T22019-004-Additions-and-Dispositions-Workchart-Incorrect-calculation-of-the-proceeds-of-disposition-of-property-in-CCA-class-54-for-a-zero-emission-passenger-vehicle-related-to-dispositions-after-July-29-2019
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