What Happened?

On September 15, 2026, the Department of Finance released a backgrounder and companion draft legislative proposals introducing the "Productivity Mega Deduction". It builds directly on the "Productivity Super-Deduction" from Budget 2025, which provided immediate expensing on roughly 15 percent of capital asset investment — manufacturing and processing equipment, clean energy and conservation property, zero-emission vehicles, patents, data infrastructure, and computers. The new measure widens the net to roughly two-thirds of capital asset investment and makes immediate expensing permanent rather than temporary. Finance estimates the incremental fiscal cost at $36 billion over five years, starting in 2026–27.

How It Works

Immediate expensing lets a business deduct the full capital cost of "eligible property" in the year it becomes available for use, instead of claiming capital cost allowance over years on a declining-balance basis. It applies to property acquired on or after September 15, 2026 — "Announcement Day".

Excluded from the expanded measure: Class 1 and Class 3 buildings (with a partial carve-out for LNG-related buildings and continued temporary treatment for manufacturing buildings under the existing Budget 2025 rules), Class 14 and 14.1 property (franchises, licences, goodwill), Class 51 (regulated natural gas pipelines), certain Class 10 and 10.1 vehicles, and property under Schedule V and VI. Canadian development expenses, as mentioned further below, incurred on or after Announcement Day also qualify. Anything that doesn't qualify falls back to the existing temporary Accelerated Investment Incentive.

As a tax practitioner, I’m used to complexity. I deal with it daily. Artificial intelligence has become a genuinely useful tool for navigating some of that complexity, and combined with a few decades of experience, it makes tax a bit easier to navigate.

What AI can’t do is cure my furniture building aversion – or anything requiring assembly. Ask me to put together a piece of flat-pack furniture, and I freeze. I have to leave the room when a family member takes one on. The instructions are vague, a piece or two always seems to go missing, and when it’s finally standing there, I’m never quite sure it’s actually put together right.

That describes Canada’s revived trust reporting rules that impact thousands of Canadians and their advisors. The instructions – determining whether an arrangement is a “trust” at all, whether it’s a “bare trust,” whether one of the many carve-outs applies – remain vague, built on undefined terms and facts that are often genuinely unknowable at the time you need them.