Alignment of the ERP landscape, such as a move to SAP S/4HANA brings an opportunity for IT and the tax department to work together as this is a good momentum for the tax department to optimise the company’s VAT determination technology whilst IT can accomplish standardisation and eliminate numerous tax customisations across their ERP instances.

The challenge for the tax department is to convince the IT department that including a 3rd party tax engine is the best solution, both from a tax and an IT perspective. For IT there is a desire for a smooth and risk-free transition and adding a new technology into the overall migration program appears to be a distraction and may add unnecessary risk while the company has managed tax determination with native customisations for many years.

This is where the tax department needs to work with IT to create a joined business case for including a tax engine into the project. The tax team need to showcase the benefits of the solution and how it can reduce some of the strain for both teams and ultimately how it positively impacts the wider business. Timely communication between the teams is of the essence in this process as including a tax engine to an ERP implementation project is much easier than adding such a solution when budgets are already set in stone.