Case study - direct tax compliance and reporting for European HR consulting firm

What was required?

The client was seeking a partner that could work with them globally and provide a pragmatic and flexible solution for them to regain control of their global direct tax compliance and reporting obligations in a fast-moving environment.

Mazars were engaged to prepare over 300 tax returns in 39 countries via our centrally coordinated approach and using our in-country experts to ensure that we could react to any changes in the local tax and reporting requirements without business disruption.

Our main reporting channels were:

• The two global tax leads
• Global, regional and local controllers

Our deliverables were:

• Meet all reporting and tax filing deadlines worldwide;
• Support the global tax team at HQ in their review of the tax returns by providing them with a standardized comment letter in English to further explain the tax returns;
• Deliver a standardized dataset with the key figures of the tax return, providing a bridge between the tax accounting schedules and the tax returns and providing easy access to all tax returns and relevant documents.

How did we help?

Given the number of companies and countries involved, we implemented a detailed transition plan centered around the InControl platform. During the transition, the communication with the local teams, understanding the needs of the global tax team, establishing clear requirements, scope and processes for the local teams, and the onboarding and transition to InControl were key.

InControl platform

We implemented the InControl platform to ensure that the client has a real-time view of their global compliance requirements. This also ensured a coordinated approach with standardization of processes and complete workflow transparency.

All tax returns and supporting documentation are stored in InControl giving the global tax team easy access to all relevant documents. A central coordination team manages the global filing deadlines and the compliance of all local teams with all requirements.

Monthly, a Steering Committee, which consists of several tax and outsourcing partners and the client's global tax managers, discuss the progress of any potential issues or escalations.

Tax dashboards

The Finance Department of the client is responsible for the preparation of the tax positions every quarter. The global tax department at the HQ of the client is responsible for the review of these tax positions.

Together with the Finance Department and the IT department of the client, our accounting, tax, and data specialists were able to export all data from the clients’ consolidation tool (Tagetik) in a structured way.

Alongside the global tax department, we translated this data into tailor-made overviews and graphs for the department, using PowerBI (embedded in inControl). This not only allowed the global tax team to easily compare data for several years and to identify relevant trends, but it also greatly reduced the review time for the tax department.

Key learnings

Central versus local approach - differences between tax jurisdictions:

When implementing a centralized approach and standardized formats and templates, it is important to take into consideration the differences between local tax jurisdictions.

Onboarding of local teams:

It is key that, apart from local compliance obligations, all local teams also understand the expectations at a central (or global) level. The implementation phase is critical to establishing clear requirements, scope, and processes for the local teams. The investment needed is significant on both sides.

Coordination at a central level:

Coordination at a central level and regular meetings between a coordination team of the service provider and the client are essential. This is to ensure progress is made against agreed actions but also that any issues and escalations are dealt with on a timely basis.

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