Special Deduction on Business Premises: Renovation & Refurbishment

The business is allowed to claim a tax deduction for costs of renovation and refurbishment of business premises under the Income Tax (Cost of Renovation and Refurbishment of Business Premise) Rules 2020 [P.U.(A) 381/2020] and Income Tax (Cost of Renovation and Refurbishment of Business Premise) (Amendment) Rules 2021 [P.U.(A) 481/2021].

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The condition to claim the special deduction:

  • All business premises, regardless of whether they are owned or rented by the taxpayer, would qualify for the deduction.
  • This is on condition that the taxpayer claiming the deduction uses the premises for business purposes.
  • Such costs are incurred between 1 March 2020 and 31 December 2021.
  • The costs of renovation and refurbishment of the business premises must be certified by an external auditor.

Taxpayers claiming the tax deduction are required to retain the following supporting documents, to be produced in the event of an audit:

  • Business registration certificate.
  • Proof of ownership of the business premises or valid tenancy agreement.
  • Invoices for the renovation and refurbishment costs.
  • Certification of the said costs by an external certified auditor.

For further clarification, kindly refer to the FAQs (in Bahasa Malaysia) updated by the IRBM as at 11 March 2022.

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