In today’s digital age, businesses face evolving complexities when it comes to managing their tax obligations. As companies grow and expand their global footprint, managing tax compliance efficiently and settling tax liabilities in different jurisdictions can become a significant challenge. Fortunately, technology offers various solutions that simplify this process, allowing businesses to focus more on their growth while maintaining compliance. This article explores the different types of technologies and mechanisms organizations can leverage to settle tax liabilities, with a special focus on Desucla’s TaxPay solution.

1. Digital Payment Portals and E-Filing Systems

One of the most common ways businesses settle their tax liabilities is through government-provided digital payment portals. Many tax authorities now provide online platforms where businesses can file their returns and make payments directly. These portals offer a streamlined way to submit tax information, calculate liabilities, and process payments, reducing paperwork and eliminating the need for physical visits to tax offices.

– Benefits:

1. Direct integration with tax authorities.

2. Real-time confirmation of payments.

3. Automated calculations based on filings.

4. Enhanced transparency and record-keeping.

– Examples: Many countries have their own e-filing systems, such as the IRS e-file system in the U.S., HMRC’s online services in the UK, and the EU’s OSS (One-Stop Shop) for VAT.

While these platforms are widely adopted, they often vary in usability and support, particularly when dealing with cross-border transactions. For global businesses, additional tools may be needed to navigate different tax regimes and streamline the process (including the need to have a local individual to access the platform).  Desucla TaxPay supports payments to these tax authorities.

 

2. Enterprise Resource Planning (ERP) Systems

ERP systems, like SAP, Oracle, and Microsoft Dynamics, offer comprehensive financial management modules that include tax calculation and payment capabilities. For large enterprises, integrating tax management into their existing ERP systems can help ensure that all financial data is consistent and compliant across multiple jurisdictions.

– Benefits:

1. Centralized financial management.

2. Automatic calculation of taxes based on location, product, and customer details.

3. Customizable reporting and analytics for better visibility into tax liabilities.

4. Integration with other business functions, such as accounting and procurement.

However, implementing ERP-based tax management can be costly and time-consuming, especially for smaller businesses or those without in-house expertise in configuring these systems.  They often lack the integration to specialist tax payment knowledge required to orchestrate successful tax payments.  Desucla TaxPay supports payment of liabilities processed by all ERP platforms.

 

3. Third-Party Tax Automation Software

For businesses seeking more flexibility and ease of integration, third-party tax automation software can be a game-changer. Solutions like Avalara, Vertex, and Thomson Reuters ONESOURCE provide tax calculation and reporting tools that integrate with existing accounting and e-commerce platforms. These tools are especially useful for handling sales tax, VAT, and other indirect taxes across multiple regions.

– Benefits:

– Automated tax calculation for e-commerce transactions.

– Real-time tax rate updates based on changing regulations.

– Streamlined compliance processes for various jurisdictions.

– API integrations with e-commerce and ERP platforms.

These platforms are particularly helpful for businesses operating in multiple regions with differing tax rates and rules. They automate complex tax calculations and ensure that businesses remain compliant without the need for deep in-house tax expertise. Whilst they support in the compliance activity they require a disparate payment mechanism to complete the process.  Desucla TaxPay supports onward payment of Tax Liabilities identified by Third-Party Tax Automation Software.

 

4. Representation Services

For businesses that trade in a foreign market that requires representation, representation services play a crucial role in managing customs & tax liabilities. A fiscal representative acts on behalf of the business to ensure that taxes are paid correctly, often simplifying the process for companies that are new to a particular market.

– Benefits:

– Simplifies the process of registration and compliance.

– Reduces the risk of penalties due to incorrect filings.

– Offers expertise in local regulations and requirements.

Desucla specializes in this space, providing services that help businesses enter those markets requiring representation, without the complexities of direct VAT registration. This allows companies to meet their obligations efficiently and with minimal administrative burden settle their tax liabilities (utilising Desucla TaxPay to settle all tax liabilities seamlessly).

 

5. Desucla’s TaxPay Solution: A Comprehensive Approach

Desucla’s TaxPay solution is a unique offering that combines the ease of digital payment with the expertise of representation and tax payment, providing businesses with a seamless way to manage and settle their tax liabilities, regardless of the tax authority, tax type or complexity of assuring accurate reconciliation.

What is TaxPay? TaxPay is a streamlined digital payment solution that allows businesses to settle VAT, Digital Services Taxes, Customs Duties and in fact any non-individual taxes in a straightforward manner. Desucla’s solution is designed to handle the complexities of orchestrating international tax payments, making it ideal for companies that want to complete their compliance processes.

Key Features of Desucla’s TaxPay Solution:

– Integrated Payment Gateway: TaxPay allows businesses to pay their tax obligations through a secure, user-friendly digital portal, ensuring that all obligations are met without delay.

– Automated Compliance: The solution includes automated checks and calculations, ensuring that all payments align with the latest regulatory requirements.

– Representation: Desucla’s experience and network of local expertise is embedded into the platform to ensure payments are requested, received & allocated correctly every time.

– Cross-Border Expertise: Desucla’s team of tax payment experts coupled with our banking partners provides guidance on the nuances of international tax payments, helping businesses navigate compliance in settling tax liabilities internationally.

Why Choose Desucla’s TaxPay? TaxPay is particularly beneficial for businesses that are looking to expand their operations internationally but want to avoid the complexities of settling tax. By leveraging TaxPay, companies can focus on scaling their operations while knowing their tax liabilities are handled efficiently, accurately and matching their existing treasury processes.

 

Conclusion: Choosing the Right Solution for Your Business

Managing tax liabilities is a crucial aspect of running a business, and the right technology can make this process smoother and more efficient. While digital payment portals, ERP systems, and third-party software all offer their own advantages, a comprehensive solution like Desucla’s TaxPay can provide additional value, especially for businesses expanding into new regions, optimising internal processes or looking to reduce fines & penalties for non-compliance.

With Desucla’s TaxPay, you get the advantage of a secure payment system combined with expert guidance and support. This means less time spent ensuring payments are allocated correctly and more time focusing on what matters most—growing your business.

Ready to simplify your tax payments? Reach out to Desucla today to learn more about how our TaxPay solution can help you manage your tax liabilities with ease.

Our first article in our TaxPay series, explaining some of the challenges in making international tax payments and solutions to those challenges.

Payment Methods for Settling Taxes in EU Countries: France, Italy, Spain, and Romania

Paying taxes in different EU countries requires businesses to navigate various national procedures, systems, and payment methods. Each country has its own specific guidelines for how taxes, including VAT (Value Added Tax), corporate income tax, and other levies, must be settled. Below is a look at the different payment methods for settling taxes in France, Italy, Spain, and Romania. These are just some of the countries our clients have had recent trouble settling their Tax Liabilities.

Desucla TaxPay enables businesses to settle all tax liabilities across the globe without the need for local bank accounts, knowledge of specific payment processing or dealing with their banks FX rates. Choose to settle in a single currency (for example settling in USD to a US based account) for onward payment in local currency via the correct method as required for that tax type and country.

France

– Bank Transfer (Virement Bancaire): The most common method for tax payment in France is via bank transfer. French businesses can make tax payments directly from their bank account to the French Treasury using a unique tax reference number. Cross-border businesses must use a French bank account to ensure smooth processing.

– Direct Debit (Prélèvement Automatique): For regular taxes like VAT or corporate tax, businesses can set up a direct debit authorization with the tax authorities. This ensures that tax payments are automatically deducted from the business’s bank account when due.

– Online Payment Portal (Télépaiement): France offers an online portal where businesses can make tax payments. The portal, part of the “Impots.gouv” platform, allows businesses to submit payments electronically.

– Payment by Card: French authorities also allow tax payments via credit or debit card, primarily for smaller amounts or individuals, but businesses can use this method for certain types of taxes.

– Desucla TaxPay: A single solution for Treasury and Tax professionals to manage tax payments. Settle in your local currency, lock in a single beneficiary and utilise our dedicated Tax Payments routes for each tax type & country.

Italy

– F24 Payment Form: In Italy, most taxes, including VAT and corporate income tax, are paid using the F24 form. Businesses fill out the form, specifying the amount and type of tax to be paid. Payments can be made through online banking, the post office, or directly at a bank.

– Online Banking (Home Banking): Italian businesses frequently use home banking platforms to process tax payments. Once the F24 form is completed, payment can be settled via the company’s online bank account.

– Electronic Payment Through Revenue Agency Portal: The Italian Revenue Agency offers an electronic system where local businesses can file and pay taxes online. This portal is integrated with Italy’s Sistema di Interscambio (SdI) for e-invoicing, making it convenient for companies to manage their tax obligations digitally.

– Direct Debit: Large companies often set up direct debit arrangements with their banks and the Italian tax authorities to streamline the process for recurring payments, such as VAT.  A local bank account is required.

– Desucla TaxPay: A single solution for Treasury and Tax professionals to manage tax payments. Near instant onward payment available for example funds received in your TaxPay USD account release FX trades and onward payments to Tax Authorities – reducing the time for funds to be received by the Tax Authority (and reducing any risk of penalties and fines).

Spain

– Bank Transfer (Transferencia Bancaria): Tax payments in Spain are commonly made through bank transfers. Businesses are required to use an authorized Spanish bank account to transfer the payment to the tax authorities, ensuring that the tax reference number is included in the payment.

– Direct Debit (Domiciliación Bancaria): Businesses can authorize Spanish tax authorities to withdraw taxes directly from their bank accounts. This is often used for regular VAT filings or corporate tax payments, ensuring timely payment and avoiding penalties for late filing. A local bank account is required.

– Online Payment (Pago Telemático): The Spanish Tax Agency (Agencia Tributaria) provides an online payment system where businesses can file returns and settle taxes. The portal accepts payments via electronic banking or cards linked to a Spanish bank.

– Payment Through Banks: For smaller businesses, payments can be made in person at a Spanish bank branch. Banks process these payments on behalf of the tax authorities, but this method is becoming less common due to digitalization efforts.

– Desucla TaxPay: A single solution for Treasury and Tax professionals to manage tax payments. Configurable workflow for approval between Tax and Treasury teams, locked beneficiaries to approved Tax Authorities (or tax agents) removing fraud risks and complete payment oversight.

Romania

– Bank Transfer: Bank transfer is the primary method for paying taxes in Romania. Businesses are required to transfer tax payments to specific accounts designated by the Romanian tax authorities, depending on the type of tax being settled. For correct allocation to your account a local bank account is required to be used.

– Online Payment Portal (Ghiseul.ro): Romania has made significant strides in offering an online portal for tax payments. Through Ghiseul.ro, businesses and individuals can settle their tax liabilities using bank cards. This portal is part of Romania’s broader e-governance initiative to simplify administrative processes.

– Post Office or Treasury Office Payments: Romanian businesses can also settle taxes in person at the post office or through designated treasury offices, although this method is used less frequently due to the convenience of online systems.

– Payment through Treasury’s POS Terminals: At local treasury offices, businesses and individuals can use POS terminals to make payments using debit or credit cards, offering a flexible option for immediate settlement.

– Desucla TaxPay: A single solution for Treasury and Tax professionals to manage tax payments. A cross entity, cross tax type and cross-country platform to provide visibility of future, current and completed payments. Documentation stored for each stage including payment demand, payment requests (for Treasury teams), payment proof and tax authority confirmation of receipt & allocation.

Common Trends and Challenges

– Preference for Digital Payments: Across the EU, including in France, Italy, Spain, and Romania, there is a clear trend toward digitalization of tax payments. Online portals and bank transfers are the primary methods, driven by efficiency and the desire to reduce administrative errors.  Often these require specific sequencing in relation to the return (before/after the submission) to avoid penalties and return of funds (often months later).

– Country-Specific Bank Accounts: In most countries, foreign businesses must maintain local bank accounts to settle taxes. This can complicate cross-border operations, as businesses need to navigate different banking regulations and requirements.  Often referencing for correct allocation of funds is required and cannot be supported by cross border international payments (i.e. a payment from your local bank).

– Administrative Costs and Language Barriers: In some countries, including Spain and Romania, tax payment procedures can be cumbersome for foreign companies. Navigating online systems in the local language, alongside complex payment processes, often requires assistance from local tax professionals.

Tax and Treasury teams have sufficient challenges just keeping upto date with changes to each countries tax demands especially given the pace of new taxes, changes to existing and new schemes being rolled out. Desucla TaxPay removes the payment burden from Treasury and Tax teams, facilitating payments inline with company payment runs, reduces risk of errors and offers dedicated tax payment methods across the globe.

Desucla TaxPay

Contact us today for more information about how Desucla TaxPay can help your organisation:

– easily grow into new markets,

– reduce the risk of tax payment fines,

– reduce your operational costs and

– complement your existing Treasury & Tax software (simple on-boarding & adoption)