Here are four steps to increase the tax impact of technology

Global tax authorities are increasing their speed of change. This allows them to process more information and shift the burden of governance and evidence review onto taxpayers.

These advancements offer tax functions the opportunity to improve operational efficiency and manage risk. Here are four steps organizations can take to unlock these opportunities.

1. Use a gradual approach

It sounds appealing to have an end-to-end transformation that enables you to use the most recent technology to deliver the tax function in the future in one go. In reality, however, there are many obstacles to this transformation and organizations typically adopt a gradual approach. Take a comprehensive look at your organization’s systems and identify the major issues. Then, create a plan for delivering these improvements over three to five years. This will ensure that you don’t end up with a patchwork.

2. Integrate tax governance

Globally, there is a growing emphasis on tax management and the recognition that most tax risks are not within the tax function. The key challenge is to ensure that vital controls outside of the tax function are maintained and documented on an ongoing basis.

PwC has been helping clients develop their tax governance over many years. In response, Smarttax Suite was developed. Smart Tax Suite, a next-generation workflow, data collection, and risk management solution that enables:

– Management and tracking of key workflows, such as corporation tax and operational taxes.

– Data collection, such as total tax contributions data or management attestations

– Operational risk management integrated

This allows businesses to create a structure for tax reporting and compliance, as well as integrate and demonstrate effective governance in a cost-effective manner.

3. Gain a better understanding about your business

Power BI and Tableau are increasingly affordable and can be used to visualize data. It is possible to simplify tedious processes by working with finance to upload detailed data and create visualisations that give you more insight. Business travel, reporting country-by-country and employee benefits and expenses are all good examples.

4. Automation can be small enough to solve large problems

Tax time can be spent on analyzing and restructuring bad data. This increases the cost and exposes you to manual error.

Alteryx and simple robotic processes are small automation tools that can cut down on the time and costs associated with data intensive tasks. This is without waiting for larger projects to improve existing systems or report quality. These tools are being used to assist clients in demonstrating digital links between source data and tax information in preparation for the 2021 launch of Making Tax Digital.

Evolution can still be revolutionary

A tax function might desire to transform the entire organization, but in reality technology is enabling incremental changes. The tax function that adopts technology quickly sees tangible benefits from the efficiencies and insights it provides to the business.

Smart Tax Suite, small automation, and data analytics tools are just a few of the options available to iteratively build technology within the tax function.