VAT compliance puts a lot of pressure on your financial, accounting, IT and travel departments. This is due to the constant changes it undergoes and the need for your group to keep up to date in all its countries of operation as well as in the countries you send travellers.
When VAT compliance issues occur, they affect the entire company. Even if you may think that it is only in the responsibility of the tax / financial / IT department, its direct or indirect implications on other departments should not be ignored.
It is much easier for your company to achieve VAT compliance when you choose the right technology to overcome some of its biggest challenges.
Managing VAT documentation manually comes with a high risk of unknowingly committing fraud due to incorrect data in your reports. Pressured by tasks and deadlines, your team responsible for checking VAT documentation might not register errors in expense forms or in the submitted receipts which could cost you a lot of money in the case of an external audit.
The role of an automated expense management tool is to ensure compliance with both internal and external policies. With the right tools and the constant improvements and updates of the expense management tool provider, you can be sure that VAT calculation is done correctly and that your company is compliant with the regulations in each country or region.
Each country or region has its own policies when it comes to reclaiming VAT and, even though it would be impossible to know each one by heart, you must still be compliant with all of them to recover your VAT.
To eliminate the risk of submitting incorrect or non-compliant data, you should ensure that the expense management solution or VAT recovery tool that you are using helps you remain VAT compliant no matter the country, region or how frequently the laws change. You should always remain compliant with international requirements, and having a reliable automated solution will help you eliminate inefficiencies.
Managing expenses and calculating VAT manually is never easy for your team and exposes your company to a high probability of human error. Due to errors and delayed expense submissions, you risk exceeding the deadline for VAT reclaims and not being VAT compliant, adding significative costs to your bottom line.
This scenario can be avoided with a clear compliance policy, having automated pre-approval and approval processes and setting strict deadlines for claim submission. Expenses can be a source of savings or an extra cost, depending on how you manage them in your company. Increased visibility and high compliance levels among your employees will help you meet the deadlines for VAT reclaim.
Just like your financial or travel teams, your IT department cannot always work on keep your company up to date with ever-changing international and local regulations. Daily, it faces issues and you should not drain their time and energy with VAT related integrations and reports.
This is why you need and end-to-end expense management solution that will help you stay VAT compliant and submit VAT reports and documentation on time. You need a trustworthy partner, an expense management software developer that is dedicated to offering you the best solution for your needs. So, look for a vendor that can prove to you how its solution keeps up with new VAT rules, all around the world.