This blog was last updated on March 11, 2019
The tax compliance playing field has gone global, with a complex web of intersecting, and sometimes conflicting, tax laws and jurisdictions. The digital era of tax compliance requires tax compliance software that can support centralized control and oversight – otherwise, companies will be vulnerable to missed deadlines, missed regulation changes, errors and discrepancies, fines, penalties and even operational shutdowns.
All of these global compliance changes, coupled with the new role of the tax professional, are giving rise to a new, more strategic approach to tax compliance software – Intelligent Compliance™. Intelligent Compliance combines talent, technology, and regulations to create a unified, centralized, proactive compliance strategy that creates greater efficiency and improved accuracy while safeguarding businesses from compliance risks and burdens.
Tax Compliance Software Solution Must-Haves
Agility
Software teams embraced the Agile methodology many years ago in order to continuously ship workable software as it was produced to provide customers value sooner than the typical 12-month to two-year development cycle. Today’s businesses must not only react quickly to fast-evolving regulations, they must be prepared for those regulations they don’t even see coming over the horizon. Tax compliance software requires a steady stream of compliance updates in order to be effective and provide tax teams with the confidence they have the most complete, and accurate regulatory analysis.
Data visibility
Data is only as valuable as it is accessible. Regulators are evolving swiftly, asking for more granular data and increasing the frequency and scrutiny of audits. Tax compliance software can provide a central source of truth to ensure visibility into all tax liability, avoiding errors and unnecessary data manipulation across a patchwork of systems, greatly reducing maintenance costs. If your tax compliance team is spending hours per week accumulating, exporting and reconciling transactional data from various systems to ensure month-end accuracy, that’s hours they could be spending growing the business by focusing on more strategic projects.
Workflows
It’s all about automation. Your tax compliance software should reduce manual entry and ensure accuracy while meeting deadlines. Also, removing the responsibility for taxability decisions from teams who don’t have tax knowledge will improve processes and increase customer satisfaction downstream when invoicing errors are eliminated due to the wrong sales tax being calculated. Seamless workflows that remove IT involvement also greatly enhance operational efficiency across the business.
Reporting & analytics
The ability to quickly identify and reconcile tax transactions with the general ledger and spotting trends, discrepancies or flows in transactions to see if there are any consistent errors creating challenges and gaps can also save tax compliance teams significant amounts of time and reduce potential penalties. Additionally, the ability to quickly satisfy auditor requests with easy access to granular transaction-level data to demonstrate your processes may reduce future audit frequency.
The right tax compliance software should empower tax teams to be more efficient and strategic in their roles. It will integrate into a company’s existing ERP and complementary transactional systems and scale with ever-changing regulations. Not to be overlooked, giving tax teams access to the right cloud-based technology will help minimize attrition and give tax professionals the strategic, innovative roles they desire.
Take Action
Get the eBook: Tomorrow’s Tax Leader – How to Cultivate Talent and Technology to Succeed Amidst a Volatile Tax Landscape to learn more about the 4 key characterisitcs of a tax compliance solution and 5 critical skills today’s indirect tax professional will need to succeed.
