Tax reform basically rewrote international tax rules. Quality, speed and flexibility are the new world order. To provide their organizations with the insights now needed, tax departments must develop technological expertise in data collection, analysis and presentation.
Changes in rates and requirements make it essential to revise tax planning and priorities. Tax authorities around the world demand a picture of the tax planning posture. Onerous compliance needs must be satisfied, and foreign earnings calculated and attributes tracked.
The focus must be on securing real-time data and making it understandable for all stakeholders, with more transparency than ever. To meet their new and different responsibilities, tax departments will acquire the skills necessary to practice tax today. They’ll be qualified to take leadership in aggregating, scrubbing, examining and presenting data. Their authoritative reports will satisfy tax authorities and inform company stakeholders, including the board and executives, in finding opportunities to enhance the global tax position.
These initiatives will be key:
- Integration, synchronization and comparison of data sources
This includes ERP and fixed asset systems, general ledgers from across the world and tax controversy material.
Data for use in driving rate impacts and cash tax liabilities must be readily available, with a process to quickly identify anomalies. If the organization is public, sources have to be reconciled in reporting to tax authorities that scrutinize the reasons for how the company is organized, whether that lines up with how the business value is driven and how the company should be taxed. The tasks require an integrated data collection tool and additional levels of automation, with data aggregation tools — e.g., artificial intelligence and RPA — as differentiators.
- Modeling of critical attributes
A model provides answers such as how fixed assets would be tracked on a U.S. tax basis, and if a new plant in Europe would be subject to GILTI and what the taxation level would be.
Because of new decision-making needs, the CEO, CFO and the board have higher expectations that presentations will be easy to follow.
Dashboards make it possible to present the effective tax rate across the globe and identify potential state exposure. They provide real-time feedback about data needed from the ERP system or tax compliance software.
Tax departments that gain the critical technological expertise will help their organizations maximize opportunities and reduce risk through a greater understanding of their tax position.
What do businesses need to understand about these threats, and how should they address them?
Listen now for details about data and tech preparedness for effective international tax planning.
National Tax Leader, Innovation and Strategy
: +1 404 475 0078
Managing Partner, Tax Technical Leader, International Tax Services
: +1 202 861 4104
Managing Director, International Tax Services
: +1 704 632 3499