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Building for the Future: Tax Measures for Low-Carbon Energy and Home Buyers
From enhancing incentives for low-carbon liquefied natural gas and carbon capture to boosting home buyers’ RRSP withdrawals, Canada’s recent Spring Update targets green energy and housing goals.
By NomadicTax Research Team • 5-8 min read • June 12, 2026
## Key measures announced in Spring Economic Update 2026
- **Accelerated Capital Cost Allowance Rates** for low-carbon liquefied natural gas (LNG) facilities. Allows faster write-offs of eligible property costs, reducing taxable income in early years. ([budget.canada.ca](https://budget.canada.ca/update-miseajour/2026/report-rapport/tm-mf-en.html?utm_source=openai))
- **Investment Tax Credit for Carbon Capture, Utilization, and Storage** (CCUS) measure expanded—aimed at encouraging investment in carbon capture. ([budget.canada.ca](https://budget.canada.ca/update-miseajour/2026/report-rapport/tm-mf-en.html?utm_source=openai))
- **Permanent exemption under the Employee Ownership Trust Tax Exemption**: Capital gains exemption for business sold to employee trusts or cooperatives is proposed to be made permanent. Currently valid for dispositions through end-2026. ([budget.canada.ca](https://budget.canada.ca/update-miseajour/2026/report-rapport/tm-mf-en.html?utm_source=openai))
- **Home Buyers’ Plan (HBP)** change: Eligible home buyers purchasing jointly may each withdraw up to **\$60,000** from their own RRSP to help purchase or build a first home. ([budget.canada.ca](https://budget.canada.ca/update-miseajour/2026/report-rapport/tm-mf-en.html?utm_source=openai))
## How these affect planning
### For business & energy sectors
- **Accelerated deduction** helps new or expanding LNG facilities manage cash flow and reduce early-stage tax burden.
- The CCUS credit lowers after-tax cost of installing carbon capture facilities—important for eligible companies in fossil fuel, industrial emissions sectors.
- Companies should review project timelines—if construction or property acquisition occurs after key effective dates, ensure eligibility. Timing matters. ([budget.canada.ca](https://budget.canada.ca/update-miseajour/2026/report-rapport/tm-mf-en.html?utm_source=openai))
### For individuals & home buyers
- Joint purchasers gain more RRSP-funded deposit flexibility under HBP, increasing access for first homes. Plan which RRSP to draw from, particularly if in different income brackets.
- Employee Ownership Trusts: owners thinking of selling to employees might benefit from **capital gains exemption**—better to consider transition planning before end-2026 deadline unless the exemption is made permanent. Move quickly. ([budget.canada.ca](https://budget.canada.ca/update-miseajour/2026/report-rapport/tm-mf-en.html?utm_source=openai))
## Action tips to take advantage now
- If you’re planning to invest in LNG or CCUS projects, ensure project timelines align so expenses qualify for enhanced deductions or credits.
- Businesses selling to or converting into employee ownership trusts should consult with accountants to structure the deal to benefit from exemption.
- Home buyers anticipating purchases—coordinate RRSP contributions, withdrawing strategy, and joint ownership structures to align with new **\$60,000 per person** rule.
## Example
- A small company investing in carbon capture late 2026 may acquire eligible assets under new rules—reduce taxes by claiming larger investment tax credits and accelerated depreciation rates.
- A couple each with RRSPs plans to buy a first home together—each withdraw \$60,000 now under the newer, expanded HBP—potentially \$120,000 down payment—not taxable if repaid over years. Plenty of downsides if repayment is ignored.
## Potential pitfalls & things to confirm
- Many measures are **proposed or in draft legislation**, subject to Royal Assent and regulatory detail. Always confirm status before relying on benefits. ([budget.canada.ca](https://budget.canada.ca/update-miseajour/2026/report-rapport/tm-mf-en.html?utm_source=openai))
- Ensure you meet eligibility conditions—especially for usage, timelines, and project definitions.
- Tracking accounting and tax filing properly is essential. Written evidence, receipts, proof of intent to use facilities for eligible operations.
These changes show Canada’s dual emphasis on housing affordability and environmental responsibility. With the right planning, you can position yourself—whether business or individual—to reap significant benefits in tax savings and financial flexibility.