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Something that is non-obvious in this space is that some of this can be down to tax treatments and asset depreciation. In a nutshell, when you buy an asset you
by joncrocks 3y ago
Something that is non-obvious in this space is that some of this can be down to tax treatments and asset depreciation.
In a nutshell, when you buy an asset you can depreciate the value of the asset over the working life of the asset and in many tax jurisdictions (my knowledge/experience comes from the UK and US asset financing industry) offset that depreciated amount against profits, in the year the asset depreciates.
This means that you can essentially offset capital expenditure against tax, which is good business.
But if you don't make enough profit through the use of the asset at the right time, you end up losing the benefit.
But there exist large companies that make lots of profit, such that they can always offset the depreciation. And so _they_ can buy the asset, use the depreciation against their profits and then lease the asset to you. They might even be able to do this at a rate that ends up _being cheaper than you actually owning the asset_, depending on circumstances.