Automation: essential for a tax future-proof business

The tax and compliance function within businesses is going to change significantly in the coming years. Rapid technological changes, different expectations in society, new tax areas such as sustainability and global tax reforms call for adjustments. How do you ensure that your business is tax future-proof? The advice of PwC experts Stan Berings and Sabine Barlage: start with automation and explore outsourcing options.

Can you keep up with the changing tax landscape?

Changes in the global tax landscape are happening fast. From the introduction of Pillar Two and the guidelines of the Corporate Sustainability Reporting Directive (CSRD) to tax reforms and the rise of real-time reporting. Both laws and regulations and expectations of governments - and stakeholders - are changing. And with that, the workload increases.

Where the focus on compliance used to be on reporting afterwards in fixed compliance cycles, we are moving towards realtime relevant insights and data for future business operations. Technology, automation and data-driven working play an increasingly larger, sometimes indispensable role in this.

Opt for automation of compliance processes

With the increasing demand for real-time reporting, technology and optimal use of data become increasingly important to perform the tax tasks within a business well. Without automating compliance processes, it is difficult for businesses to meet all the new and complex requirements. Simply because there is too little staff and too little time available at many organisations to perform all these extra tasks. The question of whether investing in automation pays off enough gives way to another pressing question: how much will not - or not timely - investing in automation cost your business?  

Need for more digital skills

Technological solutions can alleviate the extra workload to some extent and there are an increasing number of tools tools available for tax professionals. For example, there is data management software that saves your business countless hours of manual work in preparing data for tax calculations. But a tax function in which data-driven working and automation play a larger role also requires different skills from employees.

Do you notice a gap in your business between the internal capabilities and what is required of you by governments and legislation? Then outsourcing part of your tax and compliance process may be worth considering. Collaborating with external technology and data specialists, who bring expertise at the cutting edge of software and tax skills, can bring you important benefits. Such as the availability of specialists who are not or very hard to find.

Three handles for future-proof compliance

Achieving a future-proof tax and compliance function is more of a marathon than a sprint. How do you start? We give you three suggestions:

• Set up a future-proof compliance department
  What does your current compliance department look like? And what is the desired design of your tax and compliance function? Think about what future-proof compliance and tax processes should look like within your organisation. 
• Leverage expertise from specialists
  Working with the right specialists makes it easier to meet all compliance requirements. If you choose the right partner, you avoid having to work with several parties separately. You can also leverage the knowledge and expertise of external tax, data, and tech specialists. An additional advantage is that your company can focus on what it does best.
  
• Accelerate change
  Change is faster and costs are lower if you have access to new technologies, can use data expertise and implementation experience from specialists, and can rely on a knowledge database of global laws and regulations.

Connected Tax Compliance: the right people and the right technology

Although tax tools are getting better, until recently there was no solution for the complexity of corporate tax, environmental taxes and compliance challenges that large international businesses face. To meet this need, we have designed our Connected Tax Compliance approach: one fully integrated and automated process for all your compliance obligations worldwide. With Connected Tax Compliance, we strengthen the right people with the right technology. This includes both your internal employees and our external professionals. Together, we develop a tax and compliance function that is ready for the future.

Video: dealing with the increasing complexity of compliance and regulatory pressure

We recently conducted a survey among a number of organisations about the future of the tax function. In the video below, PwC experts Sabine Barlage and Stan Berings discuss some remarkable results.