It seems like the digital landscape is evolving at a faster and faster rate. Businesses adapt and change to keep up and maintain any competitive advantage. Tax authorities make frequent alterations to the tax code in response to these changes in business practices. Businesses are forced to modify internal operations to stay on top of tax regulations. These changes in business and taxes help to further the evolution of the digital age – the cycle continues with technical advancements and new complexities. Tax compliance management in the age of the internet presents unique challenges, along with opportunities to take advantage of improved technologies.
Taggart & Partners are the small business accountant Brisbane businesses turn to for assistance with the intricacies of tax compliance. Contact us to learn more about our services and to schedule a consultation. Start by calling 07 3391 1188, emailing enquiries@taggartandpartners.com.au or get in touch online.
Out Tips for Tax Compliance Management in the Digital Age
Stay Up to Date with the Australian Taxation Office Guidelines
Regularly check the website of the Australian Taxation Office (ATO) for any updates to tax laws, regulations and reporting requirements – in the digital age this couldn’t be easier. All the relevant information pertaining to the tax code is available and regularly updated on the ATO website. They want this information to be easily accessible so they can efficiently receive correct tax income.
Use Accounting Software
Some of the greatest conveniences of the digital age are the automatic updates to the software that we regularly use and rely on. This is especially useful for accounting packages, as software updates will make the necessary adjustments to the application’s recording and reporting methods to stay in compliance with any new tax regulations. Some accounting packages even integrate with the ATO’s systems to make reporting easier.
Keep Good Records
Maintaining good records is important for all businesses for the purposes of forecasting, projections, inventory management, and the list of other reasons goes on and on – but keeping good records is also vital for tax compliance management. Fortunately, advances of the digital age help with record keeping, as records are backed-up off-site in the cloud at a secure location, ensuring all records are safe and readily available. But the ATO does have a requirement for physical supporting documentation related to taxation to be kept for five years, meaning the digital age hasn’t solved all record keeping needs, at least not yet.
Educate Your Team
With so much effort being put in to getting the business off the ground, it’s easy for a new small business to overlook the potential benefit of staff training. But team training in tax compliance risk management increases knowledge and awareness of tax laws and regulations, and this knowledge spread among the entire team will help them to recognise potential tax compliance issues before escalating into tax violations.
The Complexity of Tax Compliance Risk Management
Tax Code Variability
There are many kinds of businesses with different business structures and sizes, operating in different industries. To handle the complexity and the one-size-DOES NOT-fit-all nature of modern business, there are many different exceptions to tax codes.
Changes to Tax Laws
As the times change – and they do change rapidly in the digital age – tax laws must change to keep up. This creates a unique challenge for businesses to stay up to date with these modifications to the tax codes, which are often difficult to track and interpret.
The Global Digital Economy
The digital age has increased the scope of many businesses to include international transactions. Cross border tariffs and treaties on e-commerce can vary significantly from Australian law, and an organisation may have to consider compliance requirements from other countries.
Record Keeping and Reporting
We already mentioned this above as one of our tips for tax compliance management, but it’s worth repeating because this is one of the single most challenging aspects of staying compliant with tax regulations. This is especially true as a business grows and the amount of data and records that need to be kept increases.
Consult with a Tax Professional
The above reasons illustrate why quality assistance from an expert in tax planning can be invaluable for a small business. When you engage with a consultant to assist with tax planning, you get the benefit of years of experience and a thorough understanding of tax regulations, along with knowledge of deductions and tax code exceptions. There is no substitute for professional consultation and planning.
Engage with Taggart & Partners
Running a business is already full of challenges and difficulties – there is no need for tax regulations to create additional layers of complication. The team at Taggart & Partners is ready to help you navigate the complexities of tax compliance risk management in the digital age through our small business tax planning services. Contact us today to schedule a consultation by calling 07 3391 1188, emailing enquiries@taggartandpartners.com.au or by getting in touch through our online form.