Lately, we have been hearing a lot about Tax Compliance, and it is not for nothing. Tax Compliance is extremely important to the companies, and we will help you to understand why. In the first place, let’s take a look over the implications of this term.
The verb “to comply” means act according to an order, obey, agree. Compliance, derived from this verb, means the action of complying. Applying this to the reality, Tax Compliance means acting according to tax rules and laws. The main purpose of this practice is the mitigation of risks in the fiscal area of companies.
But why is it so important? Remains the question.
Well, every business has to deal with taxes, making payments according to the authorities’ requests, submitting them informations through different formularies, and a lot of other things, according to what is legal in the city, state or country. At the same time, these organizations also have to deal with its own requirements and procedures, which combined demands a huge effort of the entrepreneurs.
The situation gets more serious due to the tendency that tax rules have to change frequently. Most of the time, it is almost impossible to keep up with all the alterations, and it represents even higher risks for the company – once it can be hurt by mistakes beyond what is possible to predict.
That is when Tax Compliance shows itself vital for the companies, being able to manage all these questions.
This practice comes to support the business, presenting better and easier ways to comply with all the tax obligations. Through Tax Compliance is also possible to discover improvement opportunities, which is essential for every business.
In Brazil, for example, Tax Compliance is an urgent demand. Companies struggle to fulfil tax requirements, and that is really exhausting work. The country lives a true tax war, where federal, counties and states’ entities fight over contradictory and complex laws that only turn the usual bureaucracy into something even more cruel to businessmen.
Brazilians’ entrepreneurs are then finding Tax Compliance as the best ally.
In a global scenario, as we mentioned before, the search for this practice has been growing. It is possible to affirm that, today, not having a compliant company is a very stain on reputation. The damages of refusing Tax Compliance has effects even in the international business – who would like to be partner of a non-compliant organization?
Now that you have comprehended the relevance of Tax Compliance, it is time to know a little bit more about how does exactly it works.
Although its tremendous importance, it is not that simple to implement a system of Tax Compliance in a company. Imagine that you are cleaning up a house that has been messed since forever. Wouldn’t it be hard? That is the same problem in most of companies. Regulate all the wrong procedures is an arduous job.
Accomplishing an exemplary level of Tax Compliance will take a lot of effort. First, is necessary to evaluate every single aspect of the company, then design the best strategies to correct all them, and, after this, is need to develop a tool, or scheme, to assure they going to be compliant.
It is important to emphasize that Tax Compliance is not a generic solution which can be applied with no modifications to all organizations. It is a solution that performs differently according to the companies – that are different and have unique demands and issues.
However, there are a few guidelines for implement this activity. Commitment is the basic pillar of these process. Without it, there is no way to accomplish compliance. The employees, the managers, administrators, everyone has to be committed with the same goal: improve the performance of the business. Is essential to be aware that the improvement will be a continuum. Achieving compliance does not happen overnight. It is a long process with gradual results that get better slowly.
Another important point is that you should search for specialized professionals to assist your business through the compliance process. Thereby is possible to reformulate your company’s practices with efficient impartiality – for it may be difficult to some entrepreneurs to modificate by themselves some procedures that have been instituted a long time ago.
The Tax Group has been performing a significant job in this field in Brazil. With disruptive solutions, we have been revolutionizing the way companies deal with taxes in our country. Through the expertise of our consultants we deeply analyse the tax payments of business in order to identify what is correct or not. We investigate and understand all the details about the company and that is how we can offer them the best plan to achieve tax compliance.
Reviewing the last five years of tax declarations, we are able to find any existing gap that may harm the company, or result in some form of restitution.
The benefits are many and they aggregate so much value, optimizing all the business’ functions, saving the entrepreneur’s time, and keeping the company away from any complication with the tax authorities.
In conclusion, we can perceive that Tax Compliance is more than relevant for all organizations, once its absence can cause irreparable damages in an organization. Even though it is not simple to do, it is extremely important to invest time, effort and resources to protect your business.
Taking unnecessary risks it is not a wisely decision, so do not wait for an unpleasant surprise to do something important for your business. Be in safe, be in compliance.