Legal Definitions - capital improvement

Capital improvement refers to an investment made to acquire or enhance a fixed asset. It is also known as capital expenditure or capital outlay.

For example, a company may spend money to purchase new machinery or upgrade its existing equipment. A city may invest in building a new bridge or renovating a public park. In both cases, the funds spent on these projects are considered capital improvements.

These examples illustrate how capital improvements are long-term investments that are expected to provide benefits for many years. They are not considered regular expenses, but rather strategic investments that can help improve efficiency, productivity, and quality of life.