Updated · Originally published
There are many ways to compare the pros and cons of Microsoft Dynamics CRM Online vs On-Premise. Tax ramifications are not usually considered, but they should be.
- Microsoft Dynamics CRM Online is a monthly subscription cost. This is an operating expense.
- Microsoft Dynamics CRM On-Premise is a large upfront cost with a small annual maintenance fee. This is a capital expense.
For example, you could have one big upfront payment of $1,000 per user license plus a 20% maintenance fee every year, versus spending $65.00 for that license per month, forever.
In my experience, larger companies tend to buy their Microsoft Dynamics CRM licenses as a capital expense, versus renting them. If you list your CRM system as an operating expense, over time, it's a very expensive option. If you capitalize the cost, you just reduced your tax base.
Before purchasing Microsoft Dynamics CRM, or any new technology, you should look at the tax advantages plus government incentives for different types of investments.
So let your IT and Sales teams debate the value of the cloud. However, ensure that your Finance team has the opportunity to weigh in on the distinction between operating expenses and capital expenses when selecting your Microsoft Dynamics CRM system.
If you are comparing Microsoft Dynamics CRM Online vs. On-Premises and want honest advice, contact ForgeXRM.
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By Ryan Plourde, ForgeXRM,
