NEWS & VIEWS
Amid the challenges of tax reporting season, one thing you should never forget is the importance of reviewing all the internal processes you have in place.
Processes are critical. They help make sure you maintain consistency, avoid silly mistakes and create the best tax packs possible for your clients.
Below is a step-by-step guide on how you can review your internal processes efficiently and effectively.
Dry run
The first thing we’d recommend is doing a dry run of your tax reporting processes. Take the time to think about whether the processes you currently have in place are fit for purpose. A lot can change over the course of a year, especially in the world of tax. Consider if the processes you wrote one, two, three years ago are still valid today.
Review your process
Next, take the time to incorporate any lessons you’ve learnt from previous tax years. What previously hadn’t been captured in your tax reporting? Were there any sticky points in your processes? Was there anything that might have fallen down? Reviewing is also a great opportunity to eliminate any unnecessary steps.
TIP: Hand your tax reporting process over to another member of staff and get them to run through it. Are they be able to complete it? Are there any failures? Did they struggle? A second pair of eyes can ensure nothing slips through the net during the review stage.
Update your process
Following a review of your tax reporting processes, what we’d recommend next is taking the time to ensure your processes account for new regulatory reporting functions. This step may already form part of your quarterly or annual check process but it’s vital that you make sure this is incorporated into your overall process.
Have you made sure your processes include Excluded Indexed Securities, for example? Last year, HMRC said the individual self-assessment return form for capital gains would be amended with a new box for gains arising on the disposal of Excluded Indexed Securities. It is important that you don’t forget updates like these or you risk putting your client in a difficult position with HMRC.
Documentation
Finally, we recommend you check your documentation. Though this is often a time-consuming process, it is critical when you’ve got so much to get done.
One way of ensuring you get your documentation right is by having a control checklist. This will help make sure you have completed every single step and have done everything you could to mitigate any risks.
Having this internal review in place not only benefits you but also your whole organisation. It will ensure you complete your tax reporting efficiently and accurately. If you have any questions on how you and your firm can better streamline your processes, get in touch.