Land and building depreciation rate malaysia
Freehold land is not depreciated as it has an infinite life. Buildings on freehold land and leasehold land are amortised at the rate of 2% per annum. Depreciation of other property, plant and equipment is provided on a straight-line basis calculated to write off the cost of each asset to its residual value over its estimated useful life. Capital allowances consist of an initial allowance and annual allowance. Initial allowance is fixed at the rate of 20% based on the original cost of the asset at the time when the capital expenditure is incurred. While annual allowance is a flat rate given every year based on the original cost of the asset. a. Investment property is property (land or a building – or part of a building – or both) held (by the owner or by the lessee under finance lease) to earn rentals or for capital appreciation or both, rather than for: i. Use in the production or supply of goods or services or for administrative purposes, or ii.