Convert a one-time IT/software price into a monthly OPEX plan: amortization schedule, financing cost, buy-vs-finance break-even and reseller view.
CAPEX to OPEX Calculator (IT Financing)
Convert a one-time (CAPEX / one-time charge) IT or software price into an equivalent monthly (OPEX) payment plan — with a full amortization schedule, the present-value buy-vs-finance comparison, and optional reseller economics. Everything is computed in your browser; nothing is sent to a server. The one exception is a link you choose to copy: it carries your figures in its address, and they reach our server when someone opens it. It compares cash flows only: leasing the equipment does not by itself keep it off the balance sheet.
Buy now vs finance
If it is a lease: what the lessee's accounts show
Leasing does not by itself keep equipment off the balance sheet. A lessee reporting under IFRS 16 or a local equivalent (SFRS(I) 16 or FRS 116 in Singapore; MFRS 16 for Malaysian entities other than private entities) recognises a right-of-use asset and a lease liability (SFRS(I) 16 paragraph 22). The rent is replaced by depreciation, which stays within operating costs, and interest, which is a finance cost. A lessee may elect instead to expense a short-term lease (12 months or less, with no purchase option) or a lease of a low-value asset straight-line (paragraphs 5 and 6). The figures below assume no such election, take the plan's own rate as the rate implicit in the lease, and depreciate over the lease term. Frameworks for small and private entities are not covered.
Sources: IFRS 16 (IFRS Foundation) · IFRS 16 Project Summary, p.5 · SFRS(I) 16, 2026 (ASC Singapore) · MFRS 16 (MASB)
Internal — not for customer sharing
Amortization schedule
—| Month | Opening | Payment | Interest | Principal | Closing |
|---|
Four inputs that turn a purchase price into a monthly rate
Enter your vendor cost and margin
Enter the principal / vendor cost and your reseller gross margin (% of selling price). The CAPEX selling price is computed automatically as cost ÷ (1 − margin%). Leave margin at 0% if your figure is already the final price.
Set the tenure and interest rate
Choose the financing term (1–5 years, or switch to months) and the annual interest rate the financier or partner offers. A longer term lowers each payment but, at any rate above zero, raises the total paid; a higher rate raises both.
Pick payment timing and any residual
Arrears charges at the end of each period (most common); advance charges at the start. Add a residual / balloon value if a lump sum is due at the end rather than amortizing to zero.
Read the monthly figure and break-even
The headline shows the monthly OPEX payment, the total over the tenure, and the financing cost. The buy-vs-finance block shows when financing overtakes the cash price, both nominally and in present-value terms.
How the CAPEX to OPEX calculator works
This calculator takes your vendor cost and reseller gross margin, derives the one-time CAPEX selling price (cost ÷ (1 − margin%)), and converts it into an equivalent monthly payment plan (OPEX) — so you can compare paying upfront against spreading the cost over a financing term. Leave margin at 0% if the amount you enter is already the final price. Everything is computed instantly in your browser — no figures are sent to a server or stored. The one exception is a link you choose to copy: it carries your figures in its address, and they reach our server when someone opens it.
The monthly figure is a standard loan-style amortization of the purchase price, using the fixed-payment annuity formula (the PMT function in a spreadsheet). Each monthly payment is identical, the financed balance reduces a little each month, and at any interest rate above zero the sum of all payments is greater than the upfront price. That difference is the financing cost.
The annual interest rate reflects the cost and risk of financing — broadly the prevailing benchmark rate plus a margin for credit risk and term. The calculator also shows the effective annual rate, which accounts for monthly compounding (it reflects compounding only and excludes any fees).
Beyond the monthly figure, the buy-vs-finance block answers the question buyers actually ask: does spreading the cost help or hurt? The nominal break-even is the point where cumulative payments overtake the cash price. The present-value comparison discounts the future payments at your cost of capital — because a dollar paid in three years is worth less than a dollar today, financing can be competitive even though the nominal total is higher.
For sellers and resellers, the optional (collapsed) economics panel separates the product gross margin from any financing income, and — only when you self-finance the deal (a captive lease) — estimates the internal rate of return and net present value on the cash you deploy. If a third-party financier funds the asset, you are paid the purchase price upfront and earn the product margin only; the financing income belongs to the financier.
A note on accounts and tax: this tool models cash flows only. Leasing does not by itself keep the asset off the balance sheet; see the lessee view in the results. Tax follows its own rules rather than the accounts. In Singapore, where a lease is not treated as a sale for tax (Scenario A in the IRAS worked example), the lessee deducts the contractual lease payments and adds back the depreciation and interest charged in the accounts; where it is treated as a sale (Scenario B), the lessee claims the interest and capital allowances instead. Source: IRAS e-Tax Guide on FRS 116 / SFRS(I) 16, 4th edition, 30 January 2026. A purchased asset earns capital allowances. Treat the figures as pre-tax planning estimates.
A residual value lowers the payment and leaves a lump sum
CAPEX is a one-time capital outlay; OPEX spreads the same value into recurring operating payments.
The monthly payment is the standard fixed-rate annuity formula, the same calculation as the PMT function in a spreadsheet, in arrears or in advance.
Margin-on-selling-price means a 30% margin is 30% of the final price — not 30% added to cost.
A longer tenure lowers each payment and, at any interest rate above zero, raises the total financing cost; at 0% the total paid is the price whatever the term.
The effective annual rate is higher than the nominal rate because interest compounds monthly.
Interest takes its largest share of the first payment and a smaller share every month after. With no residual and payments in arrears, the first payment is more than half interest only when (1 + annual rate ÷ 12) raised to the number of months exceeds 2: over 60 months, only above 13.94% a year. On the default inputs (60 months at 8%) it is 32.9%; the results show the share for your inputs.
Discounting future payments at your cost of capital can make financing competitive despite a higher nominal total.
A residual (balloon) value lowers the monthly payment but leaves a lump sum due at the end of the term.
In a captive lease the reseller earns both product margin and financing income; with a third-party financier, margin only.
All calculations here run locally in your browser — none of your inputs are transmitted or stored. The one exception is a link you choose to copy: it carries your figures in its address, and they reach our server when someone opens it.
Frequently Asked Questions
- No. It is an indicative model that estimates a monthly figure from the inputs you provide. A formal lease or loan quotation depends on a credit assessment, the financier's actual rates, and any fees or taxes, and may differ.
- A longer term lowers each monthly payment. At any interest rate above zero it also increases the total amount paid, because interest accrues over more periods; at 0% the total is unchanged. Use the tenure field to compare.
- Use the rate your financier or partner actually quotes. We do not suggest a typical figure: rates depend on the provider, the customer's credit and the term, and we know of no published benchmark for IT financing that we could cite.
- No. The figures exclude GST/VAT, stamp duties, arrangement or processing fees, insurance, and any other charges unless you build them into the purchase price. Add them separately for a complete picture.
- CAPEX (capital expenditure) is a one-time purchase that is typically capitalised and depreciated. OPEX (operating expenditure) is a recurring cost that is typically expensed in the period incurred. This tool converts a CAPEX price into an equivalent stream of payments so you can compare the cash flows. Leasing does not by itself keep the equipment off the balance sheet: a lessee reporting under IFRS 16 or a local equivalent (SFRS(I) 16 or FRS 116 in Singapore; MFRS 16 for Malaysian entities other than private entities) recognises a right-of-use asset and a lease liability, unless it elects the exemption for a short-term lease (12 months or less, with no purchase option) or a lease of a low-value asset. Frameworks for small and private entities are not covered here.
- It expresses margin as a percentage of the final selling price rather than of cost. Selling price = cost ÷ (1 − margin%). A cost of 49,000 at a 30% margin gives 49,000 ÷ 0.70 = 70,000. This differs from a 30% mark-up on cost, which would give only 63,700.
- It is only shown for a captive lease, where the reseller funds the asset and collects the payments. The IRR is the annualised return on the cash actually deployed (your vendor cost), given the monthly receipts. If a third-party financier funds the deal instead, you are paid upfront and there is no financing IRR for you — only the product margin.
- Because money has a time value. A payment due in three years, discounted at your cost of capital, is worth less than the same amount today. The present-value comparison applies that discount to the monthly stream, so financing can be competitive with cash even though its nominal total is higher. The nominal break-even ignores this; the present-value figure does not.
- Yes. Enter a residual / balloon value and the schedule amortizes down to that figure instead of to zero, leaving a lump sum due at the end of the term. The residual must be less than the purchase price.
- No. All calculations run locally in your browser. Your inputs are not transmitted or stored. The one exception is a link you choose to copy: it carries your figures in its address, and they reach our server when someone opens it.
Important — please read.
For information and planning purposes only. This calculator provides indicative estimates based solely on the figures you enter. It is not financial, investment, tax, accounting, or legal advice, and not an offer, recommendation, solicitation, or quotation for any financing, leasing, hire-purchase, credit, or product.
Estimates, not guaranteed figures. Results are mathematical illustrations using a fixed-rate amortization model. They assume a constant interest rate and equal payments, and they exclude GST/VAT, stamp duties, arrangement, processing or administrative fees, insurance, early-settlement charges, and any other costs unless you include them in your inputs. Actual figures will differ.
Actual terms vary. Real financing, hire-purchase, or leasing terms depend on the provider's prevailing rates, a credit assessment of the customer, the specific agreement, and prevailing market conditions. Reseller margin, financing income, IRR, and NPV figures are illustrative business estimates only and do not represent assured returns.
No reliance; seek professional advice. Do not make purchasing, financing, pricing, tax, or investment decisions in reliance on this tool alone. Obtain independent advice from a qualified financial, tax, legal, or accounting professional, and a formal written quotation from your financier, before committing.
No warranty; limitation of liability. This tool is provided "as is" without warranty of any kind, including as to accuracy or completeness. To the maximum extent permitted by law, RECATOOLS and its operators accept no liability for any loss or damage arising from use of, or reliance on, this calculator or its outputs.
Privacy. All calculations are performed locally in your browser. Your inputs are not transmitted to or stored on our servers. The one exception is a link you choose to copy: it carries your figures in its address, and they reach our server when someone opens it.
Method & sources
How it computes
Price = vendor cost ÷ (1 − margin), margin being a share of the price; converted to a fixed-rate monthly payment by the standard annuity (spreadsheet PMT) formula, in arrears or in advance, with an optional balloon; full amortisation schedule; buy vs finance nominally and in present value at the buyer's discount rate, each payment discounted from the month it falls; if a lease, the lessee's IFRS 16 depreciation + interest vs a straight-line rental; for a captive lease, reseller IRR and NPV.
What this tool implements
- Margin is a percentage of the selling price, so price = cost ÷ (1 − margin); a 30% margin on a $49,000 cost gives $70,000, not the $63,700 a 30% mark-up on cost would give
- Payment is the fixed-rate annuity formula equivalent to a spreadsheet PMT: ordinary annuity for payment in arrears, annuity-due for payment in advance; a residual is treated as a final balloon
- The present-value comparison discounts every monthly payment and the residual at the buyer's stated discount rate from the month each one falls: payment f at month f in arrears and at month f − 1 in advance, so the first advance payment is not discounted. The captive reseller's IRR and NPV place the receipts the same way. The nominal break-even (the payment at which cumulative payments pass the cash price) ignores time value and is shown separately
- Cash-flow comparison: leasing does not by itself keep equipment off the balance sheet. A lessee reporting under IFRS 16 or a local equivalent (SFRS(I) 16 or FRS 116 in Singapore; MFRS 16 for Malaysian entities other than private entities) recognises a right-of-use asset and a lease liability (SFRS(I) 16 para 22), unless it elects the exemption for a short-term lease (12 months or less, no purchase option) or a low-value asset (para 5). Rent becomes depreciation, within operating costs, and interest, a finance cost (IFRS 16 Project Summary p.5). Frameworks for small and private entities are not covered
- Singapore tax note: where a lease is not treated as a sale (Scenario A of the IRAS worked example) the lessee deducts the contractual lease payments and adds back the depreciation and interest charged in the accounts; where it is treated as a sale (Scenario B) the lessee claims the interest and capital allowances instead (IRAS e-Tax Guide on FRS 116 / SFRS(I) 16, 4th edition, 30 January 2026)
- Lessee view, if the plan is a lease and no exemption is taken: the plan's own rate is the rate implicit in the lease, so the liability equals the price (para 26); the right-of-use asset (the price) is depreciated straight-line over the lease term (para 32); interest is the schedule's constant-rate interest (para 37). Compared with a straight-line rental of 12 × the payment a year; totals are equal over the term. Not shown with a residual or for 12 months or less
Sources
- IFRS Foundation. IFRS 16 Leases (issued January 2016; effective for annual periods beginning on or after 1 January 2019). https://www.ifrs.org/issued-standards/list-of-standards/ifrs-16-l…
- IFRS Foundation. IFRS 16 Leases: Project Summary and Feedback Statement. January 2016 — p.5, depreciation within operating costs and interest within finance costs. https://www.ifrs.org/content/dam/ifrs/project/leases/ifrs/publish…
- Accounting Standards Committee (Singapore). SFRS(I) 16 Leases, 2026 volume — paras 5, 6, 22, 24, 26, 32, 37 and Appendix A (short-term lease). https://isomer-user-content.by.gov.sg/288/b1050619-6100-452a-868e…)_16_(2026).pdf
- Malaysian Accounting Standards Board. MASB Approved Accounting Standards for Entities Other than Private Entities: MFRS 16 Leases, effective 1 January 2019, issued 15 April 2016. https://www.masb.org.my/pages.php?id=89
- Inland Revenue Authority of Singapore. e-Tax Guide: Tax Treatment Arising from Adoption of FRS 116 or SFRS(I) 16. 4th ed. 30 January 2026. https://www.iras.gov.sg/media/docs/default-source/e-tax/etaxguide…)-16_revised-(final).pdf
- Inland Revenue Authority of Singapore. Capital allowances on plant and machinery. https://www.iras.gov.sg/taxes/corporate-income-tax/income-deducti…
- Brealey RA, Myers SC, Allen F, Edmans A. Principles of Corporate Finance. 14th ed. New York: McGraw Hill; 2022 — annuity valuation, NPV and IRR, and lease-versus-buy appraisal.
What can make this go out of date
- Nothing is fetched — cost, margin, rate, tenure, payment timing, residual and discount rate are all supplied by the user.
- The accounting caveat and the lessee view rest on IFRS 16 / SFRS(I) 16 / MFRS 16, and the tax note on the IRAS e-Tax Guide on FRS 116 / SFRS(I) 16 (4th edition, 30 January 2026) and IRAS capital-allowance rules; the arithmetic does not depend on them, but the wording does if they change.
Abridged — the full review record for this tool runs longer than the list above.
Pick up where you left off
Stored only in this browser — never sent to our servers.