Tax Parameterization
What is tax compliance?
But what exactly is tax compliance? Tax compliance consists of the use of different practices to adapt a company's tax and accounting processes, so that they adjust to the legal obligations in force in their sector of activity.
In other words, it is a way to identify and resolve any issue related to tax processes that do not comply with legislation.
So, being in compliance is keeping within the rules, guidelines and/or laws established for a given situation.
Within this concept, we have, for example, compliance in purchases, a process that aims to mitigate risks and reduce the costs generated by this sector.
Understand more about this subject in the article “What is procurement compliance and how to succeed in this concept?”
A good way to understand what tax compliance is is to understand more about its importance for companies, as well as its benefits.
Being in tax compliance is being up to date with the tax responsibilities of your business.
This process also helps to reduce the tax burden of your business — using legal means, that is, free from any evasion mechanism —, minimizing administrative costs related to tax obligations and mitigating the risks of non-compliance with these tasks.
This is possible because the tax compliance sector performs the calculation and validation of tax amounts before transferring them to Organs competent bodies.
In addition, payment terms are monitored, as well as the monitoring of rules and laws, making the necessary adjustments whenever there is any change in these systems.
A company's tax compliance is also a way of guiding professionals responsible for tax activities.
As a consequence, it helps them to better understand the rules, optimize their processes and prevent possible failures that may occur in their operations.
In this way, implementing tax compliance in your company directly contributes to:
follow up and monitor tax obligations more punctually;
better control the deliveries of these obligations to the Tax Authorities;
organize and store related documents properly;
standardize internal processes;
maintain the financial and legal health of your business;
avoid problems when it is necessary to issue a Debt Clearance Certificate
But there are also several indirect benefits that can be felt by companies seeking to be in tax compliance.
Among them, the generation of more value to the business and the valorization of the brand stand out, especially due to the increase in the trustworthiness of investors, suppliers , banks and customers.
What is the importance and benefits of being in tax compliance?
What happens when a company is not in tax compliance?
Knowing what tax compliance is is also a way to prevent your business from experiencing various problems.
Non-compliance with tax rules and laws is subject to fines, interest and other penalties provided for in unfulfilled legislation.
When this happens, in addition to the extra expenses generated by late payments, other charges necessary to normalize the situation may arise, in addition to the operational cost resulting from the rework.
Added to all this, we cannot fail to mention that working out of compliance can result in more time-consuming internal processes, especially as a result of not understanding the current regulations.
As a result, the company can compromise its image in the market, impacting its relationship with customers, suppliers and potential investors.
Now that it has become clearer what tax compliance is, its importance and benefits, you may be thinking about what is necessary to avoid the inconvenience generated by not acting in this way.
For the tax compliance policy to be implemented in a business, it is necessary to define what its practices and rules will be.
In general, small companies are able to meet this need well if their entrepreneur knows in depth the legislation relevant to their segment, as well as having the help of specialized professionals.
On the other hand, medium and large companies, precisely because of their sizes and demands for tax activities, it is quite common to use their own systems for this purpose, create an exclusive department for compliance, or even hire this service in an outsourced way.
Whatever the scenario, to implement a tax compliance policy it is necessary:
establish a culture of process compliance;
do the tax planning of the company;
define the management of tax documents;
choose which technological solutions will be used.
How to stay in tax compliance?
Carry out tax planning for the company
While the tax department of a company is responsible for the operational activities to fulfill the obligations imposed by the tax authorities, the tax department aims to collect these charges.
Considering this, the taxation of a company also has a strategic character, being totally related to the expenses arising from these commitments.
Therefore, the next step to implement a tax compliance policy is to do the tax planning of your business.
One of the main objectives of this stage is to reduce the tax burden paid within the legal aspects allowed.
Av. Marques de São Vicente, 1619 - CJ 1801
São Paulo, SP 101139-003
(11) 3042-8436