Console as a business expense?

I'm a freelance web and app developer and would now like to move on to game development. Among other things, my team and I are currently in the process of developing a game for consoles, including PlayStation and XBox. At the moment I don't have a console myself to test the games natively.

Would that be a deductible business expense? By the way, I work from a home office. The console would be in the living room because there's simply no space in the office for TV and consoles.

What would you say Will the tax office accept that? Or rather not?

If what you write is correct, it is of course a company edition… No matter where it is.

But you have to expect that at some point they will check whether you are actually developing something like this and exploiting it commercially.

Many Thanks! In other words: in the event of an audit, would the tax office be enough to see that such a project is in development? In case the tax office wants to check before the game is released. Since it is our first one that we would like to market, there are no other references in the industry to show.

Everything is logical. But with such a write-off, of course, the suspicion of tax fraud is obvious. It may be that you make a note of it and ask again at a later check what has become of the game console software.

Whether the whole thing would be self-employed or a commercial enterprise is an open question, but then it's basically a business expense. But then it becomes difficult to prove the extent to which the console is used privately. If this can be resolved beyond any doubt, it is not a problem.

Hmm… It would probably be used privately… If it is already there… 😊 Of course, I would like to give the tax office honest information. To what extent would the type of output change if it was also used? A ratio is difficult to estimate here, since in game development you only need it for testing… Development is done on the computer with simulators. By the way, thank you for your comment!

This can of course be difficult. If you use the console for more than 10% operationally, then you can assign it to the (voluntary) business assets, from 50% it is (compulsively) necessary business assets. With something like that, I would keep an exact record of when and how long you used the console for business purposes, then you will roughly know the circumstances. The tax office always finds a complete record very good and is often accepted. Otherwise, the tax office could estimate how often you use the console privately. It has a bigger impact on taxation, because a usage withdrawal (i.e. When you gamble privately on the company console) is a fictitious operating income and increases your profit accordingly.

Many Thanks! Hmm… Difficult… Complicated… 😊 The console is only used for testing in game development. Often only after the end of the development period in order to test the product natively. In other words: in keeping records, the operational part would totally smear off in terms of the temporal relationship. Nevertheless, it is required operationally… Do I really have to forego using it privately in order to do the whole thing properly?

How is the thought to be assessed that as a game developer you should play games in order to collect inspiration and to look at something regarding controls etc? Relevant? Or can that be ignored?

These are of course arguments that can be named, but first of all the tax office will want something measurable.

If you should only use it very rarely for the operational area, then it would be a usage deposit and would then be assessed exactly the other way around. The proportionate expenses (attributable to the deposit) would then be operating expenses.