Reaching a Watershed Moment in Business
As organisations start to grapple with what the new ‘normal’ of 2020 (and beyond) looks like, business leaders and managers will be tasked with driving efficiencies as quickly as possible across multiple departments and territories. The news stories of decreased sales, increased unemployment and global recession hardly surprise people. The pandemic at the start of 2020 quickly dispersed finance and tax teams. All have been working from home, doing their utmost to keep costs as low as possible while taking advantage of tax breaks and temporary changes in deadlines. The goal: keep as much cash in their companies as possible to weather the storm.
From a tax point of view there are two areas that can be addressed. The immediate way is by closely assessing indirect tax, identifying where funds can be pulled back into the business and where departments or countries can take advantage of extended deadlines, to keep the business on track. This sounds simple in theory but it’s a lot more complicated in practice. People are having to find new ways of working and communicating with colleagues, all the while staying abreast of the different regulatory requirements and deadlines. Regardless of these changes the team still need the right information to file returns and ensure the business remains compliant.
Life is perhaps a little easier for those that have already embarked upon transforming their tax processes and solutions to meet regulatory requirements, such as HMRC’s Making Tax Digital (MTD) for VAT. For those juggling a remote team and disparate technologies, the margin for error is far greater. Not only do you need to equip your people with the right tools and technology, but they also need a reliable and secure internet connection to communicate with one another and be productive.
We’ve previously talked about the pains of Excel and the associated risks but the pressure for people is more intense now with the added stress of balancing their home and work lives. The lack of a streamlined, standardised approach is costing businesses in terms of time and resources. Not having the right solution in place and having to muddle through the new ways of working remotely is suddenly not the most cost-effective way to run your finance and tax departments.
For today, in terms of indirect tax, people are going to have to be exceptionally diligent in their processes. Businesses are going to have to trust their people. The days of presentism are done and the office as we knew will never be the same. There is an opportunity out of this chaos to trust, equip, and support people to do their work in this brave new world.
For those working with direct tax, there’s a bit more breathing space. Filings may be months away but, that said, the information still needs to be accurate. Now is the time for CFOs to take a strategic look at the finance and tax processes and technologies. They need to prioritise to save money and rethink how they do things. They may just find that by investing in better technology they gain greater efficiencies and are able to better equip their finance and tax workforce for this new future. The future is now, not tomorrow.
This post was created in response to the COVID-19 virus and its impact on tax and finance professionals. For more information to help support you and your business, visit our COVID-19 resource center.