Regarding the deductibility of an expenditure incurred for the anti-theft marking of an automobile used in carrying on a business (entailing engraving a code on the principal parts of the automobile), CRA stated:
[A]s a general comment, we could consider that an expense made or incurred for the anti-theft marking of an automobile is an expense of a current nature insofar as:
- the expense does not substantially increase the value of the automobile;
- the only benefit resulting from this expense is related to the insurance premium;
- the expense does not improve the automobile (for example, there is no improvement in performance or lifespan);
- the amount of the expense is small in relation to the value of the automobile.
The time at which the expense for anti-theft marking of an automobile is incurred and whether the automobile is leased or purchased are not relevant in determining whether the expenditure is current or capital in nature.