Norway’s tax administration recently advised Sovos regarding its previous plan to make the new SAF-T regulations mandatory by January 1, 2018, which it now says is unrealistic.
Sovos’ Jeroen Wensveen discussed this development in our webinar at the beginning of September, ‘Helping companies meet their eAccounting obligations is what we do. Next up is Norway SAF-T.’ The webinar was organised to help companies prepare not only for SAF-T in Norway but globally, highlighting the business implications and steps companies should now take to prepare for its introduction.
Here are some of the more notable takeaways:
Adopting A Balanced Scorecard Towards SAF-T
Using a ‘balanced scorecard’ approach, SAF-T offers both advantages and disadvantages.
On the positive side, it will make submitting data to tax authorities, sharing data with others, and integrating different accounting and information systems easier for companies. However, it will also potentially add further reporting requirements and more immediate visibility on incorrect transactional data.
The Paradigm Shift in Tax Reporting
During the webinar, Jeroen explained that Norway’s adoption of SAF-T represented one more step in a growing move by governments around the world towards increasingly ‘disruptive’ tax reporting.
The move creates a paradigm shift, as the same advances in technology that have helped businesses grow have also empowered governments to adopt more innovative tax and reporting regulations. This includes a shift to real-time reporting at a transactional level, the ‘triangulation’ of data from different organizations, and carrying out more rapid tax and reporting audits.
SAF-T forms are part of the move towards eAccounting in general, but the most ‘disruptive’ governments are moving towards eInvoicing. This allows them to invoke pre-clearance of invoicing and become involved even before commercial transactions take place.
Adopting Six Best Practices
Sovos recommends companies to consider six questions steps to help them prepare for eAccounting (SAF-T):
- What is the best way to address SAF-T requirements across all our global operations?
- How can we ensure our data is accurate and guarantee we are providing the government with the information it requires?
- Will our solution adapt to our current business processes?
- How can we ensure we have a reliable audit trail?
- Is our data secure?
SAF-T in Norway is currently voluntary for companies of any size. Once it becomes mandatory, SAF-T will apply to companies with greater than 5 million NOK turnover or 600 documents per year. The requirement will also apply to businesses that have less than 5 million NOK turnover or fewer than 600 documents each year but have bookkeeping information that is electronically available.