Final answer:
Capital Cost Allowance (CCA) for rental properties is deducted over several years and not as a one-time expense. It is a form of depreciation for income-generating property, calculated on a declining-balance basis.
Step-by-step explanation:
In the context of rental properties, the Capital Cost Allowance (CCA) is treated as a deduction over several years, not as a one-time expense. The CCA is a form of depreciation that can be claimed for the wear, tear, and obsolescence of property used to generate income from a business or property, such as rental real estate. It allows a property owner to deduct a certain percentage of the property's cost each year, spreading the deduction over the useful life of the property.
Therefore, the correct answer to the question, "How is Capital Cost Allowance treated for Rental Purposes?" is c) Deducted over several years. The CCA is calculated on a declining-balance basis, meaning each year's deduction is a percentage of the balance remaining after the previous year's CCA claim.