Making sense of complex, voluminous data is a key function of any organisation’s tax team. This challenge is undoubtedly exacerbated for workforce tax data — which typically resides across multiple systems, with several data parameters and organisational touchpoints — but Fringe Benefits Tax (FBT) takes this complexity up a notch.
Statistics reveal that the time required to complete FBT returns is more than double that of corporate income tax returns. Despite this time-spend discrepancy, FBT represents just 0.7% of the total tax liabilities collected, compared to the company income tax portion of 22.6%.1 So, not only is managing FBT resource-heavy and time-consuming; it is revenue-disproportionate.
With the rise of smart technology, including data analytics software, purpose-built data flows and tailored visualisation tools, such challenges and complexities of managing workforce tax data can be a thing of the past. Some of the innumerable benefits that investment in technology can deliver include:
Annuity leverage: once configured, whether for data-wrangling or tax assessment, workflows can be leveraged to facilitate future compliance (mitigating the risk of differing approaches year-to-year).
Consistency: automated transactional analysis and assessment (mitigating the risk of multiple resources or subjectivity creating inconsistency or inaccuracy).
Audit trail management: a workflow snapshot which, when coupled with plain english logic framing the automation, enables stronger governance.
Review ease: visualisations provide clear insights and transparency, allowing for robust and timely secondary reviews and sign-off.
Workforce Automate is PwC’s solution that is designed to automate and simplify workforce tax compliance obligations. The solution provides broad coverage across workforce compliance and risk analysis — including FBT, pay-as-you-go withholding, superannuation guarantee, employee share scheme reporting, payroll tax, workers’ compensation and vendor/contractor review — all within the one platform.
Key capabilities:
While the technology journey (particularly for workforce data) is bespoke for each organisation, it’s evident that the historical challenge of multiple systems and voluminous data can be overcome. Applying smart technology solutions can automate, streamline and de-risk your tax data processes.
Connect with us to find out more about Workforce Automate or to request a demonstration.
This is an abridged version of an original article that looks at FBT ‘entertainment’ expenses as a case study. Read more. Discover similar articles as part of the Connected Tax Compliance thought leadership series.
