Filling the tax skills gap
Compliance and avoiding the consequences of non-compliance ultimately comes down to people and processes. There is plenty of change across jurisdictions to keep up with. However, the great resignation is a trend continuing to affect many businesses in the UK across almost every industry. As workers look to leave their roles for other positions, companies will be left without their expertise and skill, ultimately risking compliance and penalties.
Losing key compliance knowledge can leave teams scrambling to understand local reporting requirements, which ultimately risks businesses making reporting errors that can prompt audits and penalties. The trick can be to invest in staff to do the utmost to retain their knowledge and skills, but it is almost inevitable that eventually employees leave.
Using technology to centralise all critical reporting processes ensures organisations are covered for any unexpected departures, as well as the added benefit of increasing their operational efficiency. Software that is constantly updated with regulatory changes such as tax rates and filing dates means teams are better safeguarded from many tax reporting risks. It also reduces the likelihood of human error while new inexperienced members of staff are trained.
Losing this knowledge means new and existing employees have to adapt to pick up the slack. To reduce operational risk and avoid the consequences of non-compliance means putting the right processes and tools in place to ensure reporting is a simple process for finance and legal teams, and they have extensive knowledge provided through the latest training and third-party expertise.
Companies today are experiencing higher levels of staff turnover. Meanwhile, tax is continuing to evolve and digitise, which all affect the ability to maintain tax compliance and avoid unnecessary costs related to tax.
Businesses will need to fully understand tax audits and carefully manage teams to navigate complex compliance tax affairs.
Tax compliance may be seen as nuisance, but every company is in the same position where repercussions for non-compliance can be hard to quantify beyond simply the financial impact. So, companies should prioritise ensuring that they are fully capable to meet tax requirements regardless of the great resignation and any changes that lay ahead.
Alex Smith is director of consulting services at Sovos
