The sixty-second answer
Keep an asset register separate from your stock. For every tool, vehicle, computer and piece of equipment, record what it is, what it cost, who has it, where it is, and whether it is in service, in repair, lost or disposed. Check it when people leave and once a year. Record every disposal, because it affects capital cost allowance.
How equipment actually goes missing
Most small businesses do not lose equipment to break-ins. They lose it one item at a time, through ordinary work. A laser level is left at a job site. A drill is lent to a subcontractor who does not come back. A laptop goes home with someone who then leaves the company. Nobody notices until the item is needed, and by then nobody remembers who had it last.
What the business is missing in each of those cases is not security. It is a record that names who was responsible for the item and where it was supposed to be. With that record, a missing tool is a question with an owner. Without it, it is a mystery and a reorder.
Stock and equipment are different lists
The first step is to keep equipment separate from inventory. Inventory is what you sell, and it is counted to value it. Equipment is what you keep and use, and it is tracked to keep it. A trades business may buy the same cordless drill for both purposes: some for resale, one for its own crew. Those belong in different lists, because the questions you ask about them are different.
The tax side draws the same line. Equipment the business keeps is capital property, reported on the balance sheet under GIFI lines such as 1740 for machinery, equipment, furniture and fixtures, 1742 for motor vehicles, 1744 for tools and dies, and 1774 for computer equipment and software [3]. Anything that gives a lasting benefit is generally capital rather than a current expense [6].
What an asset register should record
An asset register does not need to be elaborate. For each item, a handful of fields cover almost every question you will be asked about it.
What it is. A plain description, the make and model, and a serial number or asset tag if it has one. A photo helps for items that look alike.
Category. Tools, equipment, vehicles, IT, furniture, clothing and uniforms. Categories make it possible to answer questions like how many laptops the business owns.
Purchase details. The date, the supplier, and the cost, linked to the original receipt. This is what your accountant needs for capital cost allowance, and it is the part that is hardest to reconstruct later.
Assigned person. The name of the person who has the item. This is the single most useful field, because it is the one that turns a missing tool into a conversation.
Location. The shop, a specific van, a job site, the office. Location matters most for items that are shared rather than assigned.
Status. In service, in repair, lost or disposed. Status keeps the register honest: an item that is in repair is not missing, and an item that was lost is not still an asset in use.
Assign things to people, not to the company
An item assigned to the company is assigned to nobody. The most effective change most businesses can make is to put a person's name on every piece of equipment that leaves the building. The crew lead gets the van and the tools in it. Each technician gets their own meter and laptop. Shared items get a location, and a person responsible for that location.
Assignment does not have to be formal. What matters is that when someone asks where the thermal camera is, the register gives a name, and that person expects to be asked.
Audits: when and how
A full count once a year is enough for most small businesses, ideally near year end so it lines up with the books. Walk the shop, open the vans, and check each item on the register against what is there. Anything not found is marked lost, not deleted.
The more valuable check is the one at a departure. When an employee or subcontractor leaves, run the register filtered to their name and collect every item on it before their last day. That single habit recovers most of the equipment that would otherwise drift away.
There is also a compliance reason to keep the register in order. The CRA may ask for records and supporting documents, and it can inspect, audit or examine your processes and property as well as your records [5]. A register that reconciles to the purchases on the books makes that conversation short.
Small tools: expensed, but still worth tracking
For tax, small tools are treated generously. Tools costing less than five hundred dollars go into Class 12, and most small tools in that class are fully deductible in the year of purchase [1]. GIFI has a small tools expense line, 9131, for the same reason [3]. A tool costing five hundred dollars or more goes into Class 8 and is depreciated at twenty percent [1].
That can create the impression that small tools are not worth tracking because they are already written off. The tax deduction and the physical tool are separate things. A set of cordless tools, a batch of meters, or a crew's worth of safety gear adds up quickly, and each missing piece costs the full replacement price again. Track the small items that are expensive to replace or easy to walk off with, and skip the ones that are genuinely consumable.
Clothing and uniforms sit in the same zone. GIFI has an operating expense item for uniforms [3], and the CRA lists uniforms in Class 12 [1]. Branded jackets and safety gear issued to each person are worth recording against that person, mostly so they come back when the person leaves.
Disposals and capital cost allowance
Equipment leaves the business in three ways: it is sold, it is scrapped, or it is lost or stolen. Each one is a disposal, and each should be recorded with a date and the amount received, even when the amount is nothing.
This matters for tax because capital cost allowance works on classes, not individual items. When a depreciable item leaves, the proceeds reduce the balance of its class. Proceeds of disposition are usually the selling price, and they are defined to include compensation received for property that has been destroyed, damaged or stolen [2]. An insurance cheque for a stolen trailer is therefore not just good news; it is a number your accountant needs. Depending on the balance left in the class, a disposal can produce recaptured capital cost allowance or a terminal loss [2].
The opposite end matters too. Capital cost allowance can usually be claimed only once property becomes available for use [2], so the date an item went into service is worth recording alongside the purchase date.
A register without disposals slowly fills with equipment the business no longer has, and the capital cost allowance schedule drifts with it. Books and records generally have to be kept until six years after the end of the year they relate to [4], so keep disposed items on the register with their status, rather than deleting them.
Where to start
Start with the expensive and portable: vehicles, laptops, and the tools that cost the most to replace. Walk the shop and the vans once, add each item with a person and a location, and link it to the purchase if you can find it. Then make the register the place new equipment goes when it is bought, so the list stays current without another full count.
How MapleInventory handles it
MapleInventory keeps a company asset register separate from resale stock. Purchases filed in MapleExpense under asset GIFI codes land in the receiving queue, where Maple-AI sorts each line into resale stock, company asset, freight or duty, or ignore, so new equipment reaches the register from the receipt that bought it.
The register tracks tools, equipment, vehicles, IT, furniture, clothing and uniforms. Each item has an assigned person, a location, and a status of in service, in repair, lost or disposed, with disposal recorded when an item leaves. The company assets report runs by category, location, person, GIFI code or status, so a departure check is a single filter by name and a year-end review gives your accountant the list the capital cost allowance schedule is built from.