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Capitalise electricity connection on 2 year lease

Capitalise cost of electricity connection on 2 year lease?

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Could anyone advise me if it is appropriate to capitalise the costs of connecting electricity to a rented building - cost is 7.5K - when the building is on a 2 year lease?

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By paul.benny
11th Oct 2019 17:15

You could capitalise and depreciate over the two years of the lease.

To justify a longer depreciation period, you'd need some evidence that either the lease will be extended or that the landlord will reimburse part of the cost if the tenant vacates at the end of the two year period.

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