Six proven benefits of VAT automation for a better tax system

Although rules about VAT are almost similar in many places, the implementation of it is totally different, which makes this more complicated. Technological help also depends on the country’s needs and software developments.

Benefits of VAT automation

Because technology has now played a bigger role in the VAT system, the following are some of the primary benefits of an automated VAT structure:

• It minimises human error.

  This is true. Generally speaking, an automated process is system generated, so the logic here is that whatever is the automated command, it repeats the same cycle. It won’t make any errors unless the method is interrupted, which is the total opposite with human workforce. Humans as we are, we commit mistakes, so if we are to be compared with machines in terms of errors, it is likely that technology is much effective.

• VAT returns are processed quickly.

  Because everything is automated and system generated, a faster VAT system can be achieved. VAT returns specifically are managed quickly with the automated method compared with the manual way. The sad reality is that when paperworks are done by human workforce alone, it would take forever to finish them.

• Complete tax compliance is achieved.

  Technology is rapidly evolving and so is the tax system. Tax rules and regulations are flexible; it can be changed from time to time. So with the automated tax system, effective and immediate global VAT compliance is positively reached. VAT compliance alone is a big and complex process, so VAT automation can significantly support the work.

• Reports are accurately produced.

  With the easy access to VAT process, financial reports are processed accurately. So whenever there are audits, hard copies of financial records can be easily accessed and reviewed. Soft copies are not a problem too. Auditors have the convenience to compare the hard copies of financial reports with the soft copies.

• It takes away much burden.

  This is the obvious advantage of automated VAT. The burden of manual process is eliminated. Manually doing everything takes a lot of time, effort, and concentration, so with the automated system, all of these will be utilised in some areas that manpower is much needed. Aside from that, the pressure to a lot of people is also minimised.

• VAT data is safe.
  One good thing about the automation is that it keeps records safe. Although there are so many cases of security breach, a strong security system is the only solution to this. So IT professionals are much needed in this case. As long as you have the right people, you are secured.

So is VAT automation important in the tax structure? The answer is yes. It may not be a perfect help, but it can be a significant support. The flexibility of the automation anyway will depend on how each country is developing it for a better VAT assistance system.