How Tax Leaders Can Create Value by Integrating a Compliance Partner

Compliance is one of the most cumbersome components of managing tax obligations. Teams that manage this work in-house are subject to a variety of compliance pitfalls, which ultimately affect a business’s bottom line.  

That’s why it’s crucial to understand that compliance outsourcing is an investment. A prudent tax leader must only select compliance partners who meet strict criteria which point to worthwhile opportunities to add value to the business in both hard and soft dollars.  

Outsourcing tax compliance can add value in many ways, but the primary criteria for choosing a partner remain constant. Consider a potential compliance partner only if they can convince you that they’ll create net value by improving your tax operation in some or all of the following ways:

Case Study:
Compliance Outsourcing Solution Virtually Eliminates P&I for Major Bank

REDUCED COSTS

A good compliance partner achieves economies of scale that will reduce the cost of the function itself, compared to keeping it in-house. If you receive a quote for more than what it would cost to handle compliance internally, make sure you understand all the services being proposed and why they are more valuable than what you could achieve on your own.

IMPROVED ACCURACY

Partnering with a compliance provider can improve the accuracy of your filings. Tax firms employ teams of experienced tax professionals who are able to collectively stay abreast of the latest tax laws and regulations across all the jurisdictions you operate in. Through years of experience, they’re able to build safeguards to protect from the most common, and uncommon, errors. Gaining confidence in the accuracy of your tax filings is priceless. 

INCREASED EFFICIENCY

Internal tax teams are often aware of shortcomings in the efficiency of their compliance operations, but it can be difficult to get buy-in for the cost of employees, software, and process overhauls needed to make significant improvements in this area. By leveraging a quality compliance partner, your tax team has instant access to advanced tax technology, optimized workflows, and proven processes. Hire a compliance provider who helps you envision what’s possible.

REDUCED RISK

Partnering with a tax compliance firm can help reduce the risks associated with non-compliance. Tax firms with a strong track record of providing compliance services are experts in the latest tax laws and regulations across jurisdictions and can help you avoid penalties and interest. A good compliance partner will identify and eliminate points of risk exposure.

IMPROVED FOCUS

Outsourcing tax compliance can help businesses focus more on their core business. Removing the cumbersome and complex work of property tax frees up internal tax resources to work on higher-value activities like audits and tax minimization. Freeing up talented tax staff to add more value in other areas is perhaps the most commonly cited reason to outsource compliance.

Partnering with a tax compliance provider can be the right move for many companies. If you’re thinking of outsourcing tax compliance, make sure your choice will be a value-add for your department and your company as a whole. Contact DMA today to learn how we can help.