Tax moral is shifting. More often what is (still) legally allowed may not automatically be accepted by the public opinion. Reputational damage is imminent. Both on direct and indirect taxation the tax authorities have set their priorities. The tax authorities not only want to receive more tax data, but also faster and more often.
In addition, there is a tendency to allocate the ultimate tax responsibility at the highest level in a company. Since last year in the United Kingdom the Board of Directors has to sign off the company's tax strategy and also publish the strategy externally.
Tax departments and the external auditors face due to these 2 tendencies new obligations. These tendencies could however also support change.
The new data requirements of the tax authorities have to be properly assessed and interpreted from a tax risk management perspective to see whether the data requested contain any uneforeseen and major tax risks. The outcome of such an exercise could also make clear that the company has to reorganize its business and tax processes.
When all tax disciplines (e.g. TP, indirect tax; etc.) work together a joint responsibility for the overall tax affairs of a company could be established. That might facilitate the buy-in for tax investments. When successful tax can take the place it deserves: an important part of a company's business strategy.
The above will be further explained in detail the coming weeks:
- The external accountant not yet a tax risk analist
- New tax legislation in the UK: 'Tone at the top'
- More attention on Transfer Pricing
- … And on VAT
- Tax authorities request more, faster and more often tax data
- SAF-T rolled out in more countries
- The impact on in-house tax function
- Preaudit before submit
- Realise a joint tax responsibility
Above is a translation of article published in Vakblad Tax Assurance
Geschreven door Richard H. Cornelisse en Edwin van Loon
- mr. Richard H. Cornelisse, Tax Assurance Expert, managing director van de Key Group en Phenix Consulting
- Edwin van Loon RTAP, Tax Control Framework Coordinator ING Bank NV
Published by Richard Cornelisse
Richard advises multinational businesses in improving the efficiency and effectiveness of their Indirect Tax Function and Tax Control Framework.
He started his career as a manager at Arthur Andersen and then became a partner in EY where I led the indirect tax performance team for Netherlands and Belgium. Currently he is a senior managing director of Phenix Consulting.
Richard has over 20 years’ experience advising clients on international VAT issues. He is specialized in the tax aspects of financial transformations, shared service centre migration, and post merger integration work. Richard is also somewhat of a mentor, giving back to the profession. If you are interested in conversation and discussion, please feel free to contact him.