Passenger vehicles (Class 10.1) in Newfoundland and Labrador
A Newfoundland and Labrador corporation buying passenger cars and SUVs over the cost cap on or after September 15, 2026 can deduct 100% of the cost in the year the property is available for use. Combined tax rates in Newfoundland and Labrador: 11.0% on small business income and 30.0% at the general rate.
Does Newfoundland and Labrador follow the federal rule? Follows the federal rule Newfoundland and Labrador calculates corporate tax on the federal tax base, so the federal deduction would flow through if it is enacted. Details and sources
Passenger vehicles (Class 10.1) in Newfoundland and Labrador
Worked examples
| Purchase | Old year-one deduction | New year-one deduction | Tax reduction (small business) | Tax reduction (general rate) | NPV benefit (general) |
|---|---|---|---|---|---|
| $25,000 | $3,750 | $25,000 | $2,750 | $7,500 | $1,122 |
| $100,000 | $15,000 | $100,000 | $11,000 | $30,000 | $4,488 |
| $250,000 | $37,500 | $250,000 | $27,500 | $75,000 | $11,221 |
Newfoundland and Labrador's small business rate dropped to 2.0% retroactive to January 1, 2026, and is legislated to fall again to 1.5% in 2027 and 1% in 2028. The general rate is 15%. Ask the dealer where the vehicle was assembled before you sign. On the draft wording that single fact can decide whether the purchase is deductible in full this year.
What sales tax does to your deductible cost in Newfoundland and Labrador
Newfoundland and Labrador charges HST 15% on most equipment purchases. A business registered for GST/HST recovers that tax through input tax credits, so it is not part of the capital cost and not part of what you deduct. Enter the price before tax in the calculator.
If you are not registered for GST/HST, the tax you cannot recover does form part of the capital cost. Most businesses buying equipment at this level are registered.
See also: all assets in Newfoundland and Labrador · Passenger vehicles (Class 10.1) in other provinces
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