Not having a depreciation savings account – is just dumb.
In 1917 Canadian legislation initiated taxation on income and business income. Legislation allowed depreciation as a tax deduction based on the historical cost of the item depreciated.
Accountants are experts at calculating a business's maximum depreciation tax deduction.
Accountants in many cases do not advise a business to create a deprecation saving account.
The annual depreciation tax deduction is – cash not spent.
A prudent business puts depreciated cash not spent in a separate rainy day, depreciation savings account.
A depreciation savings account allows business to replace worn out equipment and software.
A depreciation savings account may allow a business the capital required to adjust and change their business model, due to rapidly advancing technological changes that are destroying business models.
