Your Guide to Year-End Tax Benefits on 2026 Heavy Equipment Purchases

If you’re a small or mid-size business looking to put money back to your bottom line this year, you could save thousands of dollars on new and used equipment purchases. Take advantage of available government tax incentives aimed to encourage businesses to buy equipment and invest in themselves.

Heavy Equipment Tax Incentives in Canada

The Capital Cost Allowance (CCA) provides accelerated tax write-offs for qualifying heavy machinery and equipment. Under the reinstated Reaccelerated Investment Incentive (RII) rules, businesses acquiring equipment in 2026 can claim an enhanced first-year CCA deduction, effectively tripling the standard first-year write-off.

For example, if a contractor purchases $100,000 in new or used equipment classified under Class 38 (excavators, wheel loaders, haulers, etc. with a standard 30% CCA rate):

Purchase price: $100,000
Standard Class 38 rate: 30%
Standard first-year rate (Half-Year Rule): 15%
Reaccelerated CCA rate: 3× the half-year rate (45%)
First-year tax deduction: $100,000 × 45% = $45,000

Additionally, there may be further incentives available for zero-emission equipment — your local Volvo dealer is a great first step to helping you find valuable incentives for electric heavy equipment.

Now’s a great time to take advantage of these tax incentives.

If you’re looking to purchase, finance or lease a new machine soon, check out our complete product lineup featuring a broad range of flexible finance options.

Disclaimer: Canadian tax incentives are complicated. There are many limits, exclusions and special rules for different types of businesses. The information in this article, and on this site, is not and should not be construed as tax or legal advice. Each business situation is different and tax regulations change frequently. We strongly recommend that you consult with your tax advisor regarding how these tax-saving opportunities apply in your situation.