More Facts Resolve Tax Risks -
IN CHAPTERS 1 to 4, executing a proactive tax risk management plan, with the tax team following a Tax Risk Management strategy, and the tax manager ensuring that he or she is accessing maximum external input, outside his or her ivory tower, the necessity for more facts becomes increasingly evident. This chapter deals with Tax Risk Management Step 5 and those “more facts!”
Lack of facts, facts, and more facts often leads to bad tax compliance and unnecessary mistakes that could have been avoided. Getting to the bottom of the facts takes time and effort and is the most important starting point in any Tax Risk Management strategy implementation. Thereafter the technical expertise can be applied properly. Large transactions illustrate this point time and time again as businesses continuously fail to check the facts, check the advice, then check the facts again.
In the case of small businesses that are participating in the tax-Radar program, this is one area that the business owner cannot delegate. The business owner must spend some time in revisiting all the potential tax risk areas in the business to ensure that proper facts and information are given to the accountant to place on the Tax Risk Matrix. If this is not done properly tax risks that are present will not be identified and will cause potential greater harm to that business. The proper completion of the Tax Risk Matrix at inception is of paramount importance.