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About In House Tax

About In House Tax

This weblog is a news and views site for tax professionals within the UK and international in-house tax community.  You will find information about appointments and people moves in and around the in-house tax market, issues affecting the in-house tax professional, opinions on the state of the tax job market, updates on tax technology, and other general thoughts of the day.

Hope you find it useful.

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Location: St Albans, United Kingdom

This site has been developed by Simon Godley, who also runs the niche tax recruitment company Talentpool Selection . Simon spends a lot of his time placing tax specialists into FTSE companies, large in-bound groups and some professional services organisations. He also recruits and is well networked around the UK tax technology and VAT markets.

Tax News

UK: Global Tax Technology Hub

Monday, 1 July 2013

By Simon Godley


When I entered the accounting profession in 1994 with Arthur Andersen in London, now almost 20 years ago, the phrase tax technology (if it existed at all) didn’t mean very much and would have sounded very ‘Tomorrow’s World’. Tax compliance software had been developed by then, although this was not much more than a well presented colour-coded spreadsheet. At this point in time, having my own PC on my desk felt very modern world, but at this point it certainly wasn’t connected to the World Wide Web.

Since then, and coming up to the present day, there has been immense growth and development of the tax technology & systems market in the UK – in terms of numbers of organisations operating in it, the variety of products and services, and the sheer numbers of specialists in the field.

Back in 2008, I set up a network Group on LinkedIn called Tax Technology People. This group now has a membership of just over 1,250 worldwide. LinkedIn gives some very useful user stats on its Groups, particularly on location demographics of group members. This reveals that Greater New York is the most popular location of where tax technology people are based (with 11% of members), with London as firmly No2 location (with 8%). Other similar tax technology groups on LinkedIn put London in the top 5 locations, with London being the only non-US location/city.

I think there are many contributory reasons for this – as well it being generally an attractive place to do business, the UK has been very innovative at developing its own domestic tax software products to handle the challenges of very complex UK tax legislation. Coupled with that, London is seen as a useful gateway to Europe, and as such has attracted a good number of overseas technology businesses (that are operating in the tax domain) to have offices in the UK, do more local business in the UK and expand their operations into Europe. Of course, the Big Four and management consulting firms have always had large offices in London, and these offices have also grown their service lines in the tax technology advisory area. These factors have all worked together over the last 15-20 years to establish London and the UK as the key global tax technology hub outside the US.

The other trend over the last 10 years has been one of globalisation, with more large-end multinationals organising their ERP systems on global platforms. There has been enormous investment by these companies to bring the accounting / finance and finance reporting functions into the fold, and tax is now also usually part of the equation.
 
Geoff Peck, a Partner with Taxaccord, an implementations consultancy for automated tax solutions has been at the forefront of these technological advancements.

Geoff comments: “UK/EU based organizations contemplating a global approach for management of indirect tax and processes will see a second wave of technology gather pace over the next 6-12 months. This will be far more compelling than previously. Without compromising the need for local knowledge those common solution elements covering jurisdictions and tax types across the world are handled in a more natural way. After all, ERP, which remains the source of truth for tax, is implemented globally, so it makes sense that your tax tools are the same way”.

It would seem that at the forefront of IT / systems developments there is a convergence of the ERP and tax reporting systems, with the aim of a large corporate group having all their financial and tax data on one global platform. This has been work-in-progress for some years now, but I sense there may be an acceleration to the finish line as the technology now seems more ready.


There will be some strong winners in this race from the product side, and those that were first movers into this enterprise level tax data management system market will be in pole position, and a market which has quite high barriers of entry as there is a very long lead time to develop an IT solution that works.
One fact remains – the people behind this fast developing sector have and continue to be drawn to the UK to further their exposure and hopefully propel their careers.

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posted by Simon Godley

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