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> I think this very much depends on how companies are "outsourcing"/hiring. Yes and no. Obviously there are a million ways to do business and taxes are really
by vineyardmike 1y ago
> I think this very much depends on how companies are "outsourcing"/hiring.
Yes and no. Obviously there are a million ways to do business and taxes are really complex, but the law doesn't revolve around actual salaries but "cost of software R&D" so this still applies to hiring contractors and other companies if the deliverable is software.
From the article:
> US companies making foreign software development-related expenditures like hiring staff, or paying for contracts abroad, are still mandated to be expensed over 15 years.
- majormajor 1y agoThe big impact here seems to be on new companies, then, yeah? Old established ones can absorb long-term expensing and more likely to be in cost-savings mode anyway. But if you're a startup you are more incentivized to keep your development local. And I have seen a lot of near-shore, in particular, shops adverting aimed startup/medium-sized companies recently, so that might be significant.
- sokoloff 1y agoIn this case, is the US company making those foreign software development-related expenditures? Or are they engaging in an arms-length B2B transaction to buy the finished product? I suspect pretty strongly that the latter will be claimed and upheld on the facts.