How ERP will help companies with digital tax administration
IN LINE with digital transformation initiatives by their respective governments, revenue boards of many countries have opted for more digital tax administrations to increase overall efficiency befitting the modern economy.
For example, Singapore’s Inland Revenue Authority (IRAS) aims to transform the taxpaying experience by connecting all the different parties digitally and leveraging innovative tools to achieve greater security at the back of the country’s drive towards a cashless future.
Similarly, Hong Kong’s Inland Revenue Department (IRD) has started pursuing the digital agenda. Recently, they extended the eligibility of e-filing facilities to encourage usage among corporate taxpayers whose revenue exceeded than HK$2 million (US$0.25 million).
These transformations are changing the dynamics between tax administration and taxpayers, and for enterprises, there are internal changes to be made.
While many businesses have embraced these initiatives, some organizations are yet to completely digitize their finances and may feel a sense of urgency in investing in a digital solution.
But instead of acquiring a uni-tasking finance or accounting software, businesses might benefit more by deploying an agile, scalable, and flexible enterprise resource planning (ERP) solution.
Enabling digital accounts
Despite all the buzz surrounding digital transformation in recent years, many enterprises are still relying on outdated accounting processes using traditional spreadsheets, which are inherently inefficient.
Further, complex taxing schemes such as the value-added tax (VAT) creates further headaches for finance teams, to track the sales and revenue from different items within their catalogs.
By deploying an integrated ERP software, many of their processes and account will be digitized, while internal processes will be more streamlined.
Finance teams no longer have to deal with the challenges of information silos, as centralized data storage will afford the full visibility of financial and transactional records.
More robust and reliable records
Manual processes using spreadsheet and paper records are prone to human errors to accounting, something a properly deployed ERP solution could quickly fix.
The software practically eliminates the chances of human errors, while increasing data integrity by restricting unauthorized edits and changes.
Role-based access levels and data security measures such as end-to-end encryption adds another layer of protection to company data, that ensures sensitive company information stays safe.
As finance is just one aspect of most ERP software, the solution can serve as a springboard for companies to embark on a slightly expanded digital journey and transform other areas of operations.
Modern out of the box ERP systems come standard with functions to streamline sales, supply chain, rostering, HR management, and even business process management.
While it may be challenging to take on a full-fledged transformation strategy, ERP allows businesses to take on an incremental, piecemeal approach.
Thus, as tax administrations around the world are progressively becoming more digital, companies that are lagging in the digital journey have to eventually also move in the same direction.
And deploying ERP software is a good starting point.
- Insider Threats: Protecting against the greatest vulnerability, the people
- Have insurers made digital the strategic priority it needs to be?
- What happens when hundreds of millions of Facebook users’ data is compromised
- Making the most of Zoom meeting etiquette
- Why manufacturers need to plan for complete automation