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[I'm speaking only from the US perspective] The only difference is if you own the gear or not. If you do own it, then it is CAPEX, and the gear goes on the bal

[I'm speaking only from the US perspective] The only difference is if you own the gear or not. If you do own it, then it is CAPEX, and the gear goes on the balance sheet and you can only depreciate it according to the schedules ( in some cases immediately 100% but most of companies blow through that number really quickly ). In all other cases it is OPEX. The rule of thumb is that all OPEX can be used to offset the revenue, which is god sent to most companies that aren't printing gobs of money. So if you make some money and you are past 100% deduction thresholds, when owning gear beefs up the balance sheets and at best slightly decreases taxes while spending money on OPEX significantly decreases taxes.

wahern 7y ago
Under the 2017 Tax Cuts and Jobs Act, you can take a 100% deduction on new and old equipment in the first year. It expires in 2022, but that's because of the shenanigans to avoid formally violating deficit rules, which use a 10-year window for assessing budget impact. I think there's a good chance that it'll be extended as you can game the budget analysis that way indefinitely.
hosh 7y ago
I didn't parse that in terms of bookkeeping. I took that to mean that the ongoing operational expenses such as, salary for the ops team, dev team, expertise, etc. may be difficult to estimate, once you figure out how to do something, they can be automated.