When you need to update equipment or technology to keep up with your small business’ growth, you have the option to either lease or purchase. While there are plenty of perks to leasing, there are also advantages that only come with owning.
Here are five benefits of purchasing new equipment for your small business:
1.)You can make modifications as needed. When leasing assets, there are usually restrictions on modifying the equipment because someone else owns it. If you take out a small business loan to purchase the items, you will own the property after the loan is paid off. This allows you to modify, repair or update the equipment as necessary.
2.)You can sell the assets to recoup the cost. If you ever decide you no longer need equipment you own, you can always sell it to get back some of the money you put in. You could then take the proceeds and put it toward the down payment on your next big purchase. This is not an option for leased machinery since you have to keep making payments for the full term of the lease.
3.)You can deduct depreciation from your taxes. Similar to the benefit business owners realize by deducting leasing costs from taxes, you can also write off the cost of equipment depreciation. According to the IRS, companies can subtract depreciation using the section 179 deduction, potentially saving thousands of dollars each year.
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