How do I identify these risks? And how do I manage them?
New and rapidly changing legislation come with big compliance challenges for CFOs and tax departments. In addition, reporting obligations towards the tax authorities, supervisors and other stakeholders are also increasing. Therefore, it is important to identify and manage your tax risks.
Tax control in the boardroom
As a CFO you must consider the interests of your organization, but also the stakeholder’s interests. For example, your organization must not only pay the (minimum) tax that you owe on the basis of legislation, but you have undoubtedly also formed an opinion as to whether you think your organization is paying it’s “fair share” of taxes. With the increasing level of interest among stakeholders, tax control and possible tax risks are becoming increasingly important within the boardroom. Therefore, it is important for you to map out the tax position of your organization.
Insight into your tax position with a Tax control framework
Stakeholders of organizations in the Netherlands and of internationally operating organizations (including tax authorities) increasingly expect your organization to systematically manage tax risks and offer structural and up-to-date insights into your tax position.
The Tax control framework is an important tool for the internal control of an organization on the correctness and completeness of tax returns. It provides you with insights into the most important tax fields your organization must deal with. Subsequently, a tax control framework gives you opportunities to deal with your tax risks.
Horizontal tax monitoring
When a Tax control framework is effective and you can provide the tax authorities with good insights into your tax position and relevant risks, the degree of control of your tax returns and amount of (costly) discussions can be reduced significantly. This does not only improve your relationship with the tax authorities, but it also sends a positive message to other stakeholders of your organization.
In the context of the further development of horizontal tax monitoring, the tax authorities have indicated that they will test the design and correct application of a Tax control framework more strictly in the future.
International compliance
Internationalization leads to an increasing degree of exposure to different international legislation. This leads to the need for a correct and well-organized system to make sure that all the activities performed by your organization meet the requirements in the different countries you operate in.
Grant Thornton has developed the Tax control framework solution to map out the tax processes within internationally operating organizations and their control of tax risks. This system gives you insight into current tax data and reports, gives you a thorough overview of the tax position of your organization and helps you identify and manage your risks through efficient and easy to use software.
The benefits of a Tax control framework for you:
- It provides you with a framework for gaining insight into your business processes and the tax risks associated with them.
- It helps you with the implementation of new (international) legislation and associated compliance obligations.
- It makes it easier to guide and educate your tax employees.
- The Tax control framework is fully cloud based and (safely) accessible from anywhere.
- It makes it easier to meet the requirements of a horizontal monitoring Covenant for your organization.
The benefits of our Tax control framework solution
- Easy and quickly implementable.
- Strong reporting capabilities.
- Fully cloud based, which makes it easy to manage for your IT-team.
- Built on years of practical experience with Tax control frameworks.
- Maintenance and updates can be performed internally or by Grant Thornton.
- Cost-effective.
