The Fintech revolution continues apace, with companies investing increasing time, effort, and budget into digital transformation. This investment is delivering improvements and efficiencies across a swathe of key processes and looks set to continue.
Tax, however, often trails behind, neglected, and overlooked. By failing to give tax their proper attention, organisations could be missing out on numerous benefits and opportunities.
Tax can be a poor relation in the digital world for various reasons. Many companies don’t even consider it as a priority – they play down its profile, and/or dedicate a lower percentage of their digital budget to it. There are a number of reasons for this that need to be addressed and overcome.
- The voice at the top: Often the senior leadership team or CFO come from an accountancy background rather than from tax. This means they will likely prioritise the areas they know well in their digital strategy and budget, rather than tax. This can trickle down to the rest of the team in terms of their priorities, competency, and focus.
- It’s just compliance: It’s a common problem with tax compliance – organisations feel they need to do the bare minimum unless their hand is forced by the regulators. Organisations typically wait until legislation comes into effect before they go action it. One only has to look at the Environmental, Social, and Governance (ESG) planning and implementation to see how that works in practice. Getting people to do more than is legally required of them can be a tough ask.
Why should anyone change their view? What benefits can be found in prioritising your tax digital transformation?
The biggest impact is on the team.
At the top level, the data insights it can provide can be hugely beneficial to both tax strategy and efficiency. Tax can be a difficult beast, and AI can wrangle its complexity to give a comprehensive picture.
At the other end, digital transformation can remove a lot of the day-to-day drudgery which frustrates us all. Automating repetitive tasks and processes, frees the team from the more mundane aspects of their work, allowing them to focus on the more strategic areas of the business that better match their skillset and promote growth.
Increased employee satisfaction and empowerment brings benefits both personally, and to the organisation, with better recruitment and retention. Early adoption of these measures gives organisations a competitive advantage in the search for new talent.
Far from replacing jobs, Generative AI can provide a safety net against human error and allow employees to do more with less. Mistakes can be costly, even with the most diligent of tax professional. Automating tasks results in few errors, without the heavy lifting.
The road ahead
A focus on tax transformation now is an investment in the future, as it is inevitable that HMRC’s current strategy will continue to compel organisations to move in this direction. We are already well on the way down this road with Making Tax Digital, and the pace of adoption of more sophisticated technology is only going to increase. Accountancy will become a very different place very quickly, and organisations would do well to lead the charge.
Fundamentally, what is required is a change in mindset.
Tax isn’t a box ticking exercise to keep the regulators happy, but an integral part of the business that can have a positive effect on the bottom line. Blending human skills and experience with technical innovation can be transformative to both the people in the business, and future growth.
There are too many opportunities to be missed. Find out more about how our solutions can transform the way you work…