Lorry Tax Deductions 2026 - Transport Business Malaysia

2026 Lorry Tax Deductions

Transport businesses operate on thin margins. Every tax deduction helps. Lorries qualify for significant tax benefits. Smart financing maximizes savings.

This guide explains lorry tax deductions. What you can claim. How to structure financing for maximum benefit.

Lorry Prices 2026

New Lorry Prices

• 3-ton lorry: RM95,000 - RM115,000
• 5-ton lorry: RM120,000 - RM150,000
• 10-ton lorry: RM180,000 - RM220,000

Used Lorry Prices

• 5-year used: RM60,000 - RM80,000
• 8-year used: RM40,000 - RM55,000
• 10-year used: RM25,000 - RM35,000

Transport Business Tax Deductions

Deductible Lorry Expenses

• Capital Allowance: Depreciation on lorry purchase
• Interest: Loan interest portion of installments
• Diesel: Fuel costs (keep receipts)
• Maintenance: Repairs, servicing, tires
• Insurance: Commercial vehicle insurance
• Road Tax: Vehicle registration tax
• Tolls: Highway toll charges

Capital Allowance for Lorries

Allowance Rates

Initial Allowance (Year 1): 20% - 40% of vehicle cost

Annual Allowance (Year 2 onwards): 10% - 20% of remaining value

Real Example: 5-Ton Lorry

Vehicle cost: RM135,000

Year 1 (40% initial): RM54,000 tax deduction
Year 2 (20% annual): RM16,200 tax deduction
Year 3 (20% annual): RM12,960 tax deduction
Year 4 (20% annual): RM10,368 tax deduction
Year 5 (20% annual): RM8,294 tax deduction

Total deductions: RM101,822 over 5 years

Tax Savings at 24% corporate tax: RM24,437

Operating Expense Deductions

Annual Lorry Operating Costs

• Diesel: RM15,000 - RM25,000
• Maintenance: RM8,000 - RM12,000
• Insurance: RM4,000 - RM6,000
• Road Tax: RM1,500 - RM2,500
• Tolls: RM3,000 - RM5,000

Total annual deductible expenses: RM31,500 - RM50,500

Tax Savings at 24%: RM7,560 - RM12,120 per year

Financing + Tax Strategy

Bank vs 0% Down Payment

RM135,000 lorry purchase comparison:

Bank (10% Down Payment):

• Down payment: RM13,500
• Year 1 capital allowance: RM54,000
• Tax savings: RM12,960
• Interest deduction: Additional savings
• Net cash Year 1: RM13,500 outflow - RM12,960 savings = RM540 net cost

Ing Heng (0% Down Payment):

• Down payment: RM0
• Year 1 capital allowance: RM54,000
• Tax savings: RM12,960
• Interest deduction: Additional savings
• Net cash Year 1: Positive cash flow (tax savings exceed payments)

Used Lorry Tax Benefits

Used lorries qualify for same capital allowances. Lower price means smaller deductions, but significant upfront savings.

Example: Used Lorry (RM60,000)

• Year 1 (40%): RM24,000 deduction
• Tax savings: RM5,760
• Savings vs new: RM75,000

Banks reject used over 5 years. We finance any age.

Transport Business Scenarios

New Lorry for Expansion

Equipment: 5-ton lorry (RM135,000)

Bank: RM13,500 down payment
Ing Heng: 0% down, preserve cash for diesel

Used Lorry for Budget Fleet

Equipment: 8-year lorry (RM45,000)

Bank: Rejected (age)
Ing Heng: Approved 100% financing

Multi-Lorry Fleet

Equipment: 5 lorries (RM600,000 total)

Bank: RM60,000 down payment
Ing Heng: 0% down, RM60,000 preserved for operations

2026 Tax Planning Tips

• Keep all receipts for operating expenses
• Time lorry purchases before Year End
• Consider used lorries for cost savings
• 0% down payment maximizes cash flow
• Claim diesel subsidy if eligible