Q: What are the provisions of the tax law on fixed assets improvement expenditure? A: The expenditure on improvement of fixed assets must be capitalized. The expenditure on improvement of fixed assets that has not been fully depreciated may increase the original value of fixed assets, appropriately extend the depreciation period, and accrue depreciation; As deferred assets, the fixed assets improvement expenses that have been fully depreciated shall be evenly amortized within a period of not less than 5 years.

The Pre-tax Deduction Method (Guo Shui Fa [2000] No.84) stipulates that the following expenses for repairing fixed assets shall be regarded as expenses for improving fixed assets:

(1) The repair cost of fixed assets reaches more than 20% of the original value of fixed assets;

(2) The service life of related assets is extended for more than two years after repair;

(three) the fixed assets after repair are used for new purposes or changed.