Quick answer: Commercial trucks lose value fastest in their first few years, then the decline slows. How fast any one truck drops depends on mileage, age, spec, maintenance records and the used truck market when you sell. Two different numbers get called "depreciation." Market depreciation is what the truck will actually sell for. Tax depreciation in Canada is capital cost allowance (CCA): 30% a year for most trucks in Class 10, and 40% for heavy freight trucks and tractors in Class 16. For trucks acquired on or after September 15, 2026, the proposed Productivity Mega Deduction could allow a 100% first-year write-off.
Disclaimer: This article is general information only and is not tax, legal or accounting advice. Tax rules change and depend on your situation. Speak with a qualified accountant or tax advisor before making any purchase or filing decision. Mehmi Financial Group does not provide tax advice.
Last updated: November 10, 2026. Tax measures are marked as law or proposed below.
Key takeaways
- Market value and tax value are tracked separately. A truck can be fully written off for tax and still be worth real money on the lot.
- Used Class 8 prices change with the freight cycle. ACT Research put the average US used Class 8 retail price at $64,007 in September 2026, up 11.5% from a year earlier.
- CRA lists general trucks and tractors in Class 10 (30%) and freight trucks in Class 16 (40%), both on a declining balance.
- The Productivity Super-Deduction (Bill C-15, law since March 26, 2026) brought back the Accelerated Investment Incentive. The Productivity Mega Deduction, which would allow full expensing, is still proposed.
- Lenders care about market value. A truck's expected resale value shapes the term, the down payment and whether an older unit can be financed at all.
- Maintenance records, a popular spec and sensible mileage do more to protect resale value than anything you bolt on later.
What truck depreciation actually means
Depreciation is the drop in a truck's value over time. For a trucking business it shows up in three places:
- the price you get when you sell or trade in
- the CCA you claim on your tax return
- the value a lender assigns when you finance, refinance or do a sale-leaseback
These three rarely line up. CRA's rates are fixed by class and have nothing to do with what the truck will fetch at auction. A lender, on the other hand, looks at what the truck would sell for if it had to be repossessed, which is often below retail. Keeping the three apart avoids most of the confusion owners run into.
Market depreciation
Market depreciation is set by buyers. It moves with freight rates, new truck supply, interest rates and emissions rules. When freight is strong and new trucks are hard to get, used values hold up or even rise. When freight is soft and fleets dump units, prices fall quickly. A truck bought at the top of a cycle can look like it lost value fast, even when it was well cared for.
Tax depreciation (CCA)
Tax depreciation is set by the Income Tax Regulations. You add the cost of the truck to a CCA class pool and claim a percentage of the undepreciated balance each year. Our guide to CCA classes covers the pool rules in detail.
What drives a commercial truck's resale value
No single formula predicts what a given truck will be worth. These factors come up again and again in used truck reports and on appraisals:
| Factor | Why it matters | What helps |
|---|---|---|
| Mileage | Engine and drivetrain wear rises with distance. ACT Research cited higher average miles as a drag on September 2026 pricing. | Steady highway kilometres with documented service |
| Age and model year | Older units carry more repair risk and fall behind newer emissions and safety technology. | Buying or selling before major component work is due |
| Spec | Common engine, transmission and axle setups sell to more buyers. | Mainstream specs for your region and freight type |
| Maintenance records | Buyers and appraisers pay more for proof than for promises. | Complete, dated service logs and receipts |
| Condition | Rust, interior wear and body damage lower offers. | Regular washing, prompt body repairs |
| Market timing | Freight demand and new truck supply move used prices. | Watching monthly used truck reports before selling |
Vocational trucks, such as dump trucks, wreckers and boom trucks, often follow a different curve than highway tractors. They usually run fewer kilometres, and the body or equipment on the chassis can hold its own value. Our heavy wrecker financing guide covers one example.
How the used truck market looks heading into 2027
Used truck pricing has been firming through 2026. According to Transport Topics' report on ACT Research data, published October 30, 2026:
- used Class 8 sales reached 24,900 units in September 2026, up 10.2% year over year
- the average retail price was $64,007, up 11.5% from $57,383 a year earlier and down 1.9% from August
- average retail mileage was 414,000 miles, up 1% year over year
ACT Research's Steve Tam said "higher average miles and an uptick in vehicle age" weighed on pricing. J.D. Power data in the same report showed auction prices up 24.8% year over year.
These are US figures in US dollars, but Canadian prices tend to move in the same direction because units cross the border in both directions. The point for owners is that the value of a truck depends on the year you sell it as much as on the truck. Planning a trade-in around market conditions can matter more than a few months of extra use.
An illustration of how a truck loses value
The table below is a hypothetical example, not market data. It shows the usual shape: a steep early drop that flattens out. Real results vary widely with mileage, spec and the market.
| Point in life | Typical pattern | What the owner should watch |
|---|---|---|
| Year 1 to 2 | Steepest drop in value | Loan balance versus truck value, especially with low down payments |
| Year 3 to 5 | Decline continues at a slower pace | Warranty expiry and upcoming major service |
| Year 5 to 8 | Value tracks condition and mileage closely | Engine and aftertreatment history, tire and brake condition |
| Year 8 and up | Value is mostly about remaining useful life | Whether repair costs now exceed the truck's worth |
This curve is why many owner-operators look at trucks a few years old. Someone else has absorbed the sharpest part of the drop. Our used vs new truck analysis compares the two paths, and where to buy used commercial trucks in Canada covers sourcing.
How CCA works for trucks in Canada
CRA's CCA rate table lists two main classes for trucks:
- Class 10 at 30%, for general trucks, tractors and trailers
- Class 16 at 40%, for freight trucks
Under the Income Tax Regulations, Class 16 covers trucks and tractors designed for hauling freight, used primarily for that purpose, with a gross vehicle weight rating over 11,788 kg. A heavy highway tractor in a for-hire freight business usually lands in Class 16. A pickup or a light service truck usually lands in Class 10. Your accountant should confirm the class for each unit.
The tax measures that apply right now
| Measure | Status (November 2026) | What it does for trucks |
|---|---|---|
| Regular CCA | Law | 30% (Class 10) or 40% (Class 16) on a declining balance |
| Accelerated Investment Incentive | Law (reinstated by Bill C-15, Royal Assent March 26, 2026) | Larger first-year claim and no half-year rule on eligible property |
| Zero-emission vehicle expensing | Law (Bill C-15) | 100% expensing for eligible zero-emission vehicles |
| Productivity Mega Deduction | Proposed (announced September 15, 2026, confirmed in Budget 2026) | Would allow permanent 100% expensing for most property acquired on or after September 15, 2026 |
Budget 2026 named heavy freight trucks among the examples of property the Mega Deduction is meant to cover. The exclusions include certain vehicles in Classes 10 and 10.1, so a light truck or passenger-type vehicle may not qualify. Used trucks would count only if neither you nor a non-arm's-length person owned them before. Since the measure is not law yet, check its status before you file. Our immediate expensing rules for equipment post tracks the details.
Tax value versus real value
A fast write-off does not change what the truck is worth. If you expense a truck in year one and sell it in year three, the sale proceeds (up to original cost) come back into the pool and can create recapture, which is added to income. Owners who sell a truck they fully wrote off can face a tax bill they did not expect, so plan the sale with your accountant. Our equipment depreciation and CCA calculator helps you model a few years ahead.
Buying, leasing and who claims depreciation
How you pay for the truck decides who claims the tax depreciation and who carries the resale risk.
- With a cash purchase, an equipment loan or a conditional sales contract, your business owns the truck, claims CCA and keeps any value left at the end.
- With a true equipment lease, the lessor owns the truck. You generally deduct the lease payments instead, and the residual value set in the lease shifts some of the depreciation risk to the lessor.
Lease residuals are, in effect, a lender's forecast of depreciation. A higher residual lowers your payment but leaves a larger buyout at the end. Our posts on buying vs leasing commercial trucks, CCA vs leasing and how to calculate a lease rate go deeper.
How lenders look at depreciation
When you finance a truck, the lender is betting the truck will be worth more than the loan balance if things go wrong. Depreciation shapes almost every term they offer.
- Older trucks usually get shorter terms, so the balance falls at least as fast as the value.
- Low or no down payment deals are easier on newer, popular units. Our guide to zero down truck financing explains when that works.
- High mileage or unusual specs can mean a larger down payment or extra collateral.
- Your credit, time in business and cash flow still carry heavy weight.
Startups can qualify too. If your business has at least 6 months of revenue in its bank statements, there are lenders who will look at a truck file. Rates depend on the file, so read our commercial truck loan rates guide for what affects pricing.
What we see on real files
A few patterns come up often. Buyers who stretch a long term on an older, high-kilometre truck can end up owing more than it is worth halfway through, which makes a trade-in hard. Files with full service records and clear photos of the unit tend to move faster, because the lender can judge value without guesswork. Owners who plan a trade-in a few months ahead, rather than after a major breakdown, usually have more options. Equity in a paid-down truck can also be used for working capital through refinancing or a sale-leaseback.
How to slow depreciation on a truck you own
- Keep every service record, dated and organized by unit. A digital maintenance log works well.
- Fix body damage and rust early. Small cosmetic problems lower offers out of proportion to their repair cost.
- Stay on top of aftertreatment and emissions maintenance, which buyers and inspectors check closely.
- Avoid heavy custom modifications that narrow the pool of future buyers.
- Watch monthly used truck reports and plan your sale or trade-in around market conditions.
- Keep financing terms in line with useful life, so equity builds over the loan instead of shrinking.
Frequently asked questions
How fast do commercial trucks depreciate?
The steepest drop usually comes in the first couple of years, then the decline slows. The actual amount for any truck depends on mileage, spec, condition and market timing, so get an appraisal or check recent comparable sales rather than relying on a rule of thumb.
What CCA class is a semi truck in Canada?
A tractor or truck designed for hauling freight, used mainly for that purpose and rated over 11,788 kg gross vehicle weight, usually falls into Class 16 at 40%. Most other trucks fall into Class 10 at 30%. Confirm with your accountant.
Can I write off a truck in full in 2026 or 2027?
Possibly. The proposed Productivity Mega Deduction would allow 100% expensing for most property acquired on or after September 15, 2026, and Budget 2026 named heavy freight trucks as an example. It is not law yet, so check its status before filing.
Does a lease avoid depreciation?
A lease still prices in depreciation. It is built into the lease payment through the residual value. With a true lease, the lessor carries the resale risk and you deduct payments instead of claiming CCA.
Can I finance an older truck?
Often, yes. Expect a shorter term and possibly a larger down payment. Our post on financing options for used trucks and trailers explains what lenders look for.
Tools and next steps
Estimate payments with our equipment financing calculator, model tax value with the depreciation calculator, and compare structures with the loan vs lease comparison. For trucking-specific options, see truck and trailer financing, heavy-duty truck financing and our transportation and trucking industry page. Terms you don't recognize are defined in our glossary.
Prefer video? Watch The Used Equipment Financing Mistake That Makes You Pay Twice on our YouTube channel.
Finance your next truck with the right terms
Mehmi Financial Group works with over 50 lenders across Canada and the USA, including lenders who finance new and used commercial trucks. Call 1-833-863-4644 or apply online to compare your options.
Disclaimer: This article is general information only and is not tax, legal or accounting advice. Tax rules change and depend on your situation. Speak with a qualified accountant or tax advisor before making any purchase or filing decision. Mehmi Financial Group does not provide tax advice.
Sources
- Transport Topics, Used Class 8 retail sales lose steam in September (ACT Research and J.D. Power data), October 30, 2026.
- Canada Revenue Agency, Guide T4002: Capital cost allowance (CCA) rates, accessed November 2026.
- Department of Justice Canada, Income Tax Regulations, Schedule II (Class 16), accessed November 2026.
- Department of Finance Canada, Productivity Mega Deduction news release, September 15, 2026.
- Parliament of Canada, Bill C-15 (Productivity Super-Deduction), Royal Assent March 26, 2026.
- Budget 2026, Government of Canada, November 2026.
Written by Jodhbir Mehmi. Reviewed under our editorial standards. Updated November 2026.