7 Reasons Why Outsourcing Your Tax Preparation Is a Smart Decision

Are you finding that tax preparation tasks are taking up valuable time and resources within your firm?  

While these tasks may not directly contribute to the growth of your business, tax preparation is equally important as it ensures compliance with the law, maximizes deductions and reduces the likelihood of audit risks. 

To address these challenges, many firms are now considering outsourcing their tax preparation. Tax-related tasks, along with accounting and bookkeeping, are among the top time-consuming processes that businesses should consider outsourcing immediately.  

In addition, an analysis conducted by Deloitte suggests that corporate tax departments have the potential to save between 23% and 31% of their total costs by outsourcing.  

This can be achieved through better employee utilization, process efficiencies, cost savings in hiring and replacement, technology adoption, and other synergies gained from consolidating operations with a single service partner 

Hence, in this blog, we will discuss seven (7) reasons why outsourcing your tax preparation tasks could be a game-changer for your accounting department. 

7 Reasons to Consider Tax Preparation Outsourcing 

Having the right support when dealing with non-core tasks is necessary as it brings back your focus on your income-generating initiatives. Tax preparation is one of the business activities you can outsource. Here are 7 reasons to consider this option: 

1. Access to Global Talent

Among the top advantages of outsourcing your tax preparation is gaining access to a pool of global talent and expertise. Doing this will help your company tap into the knowledge of professionals who specialize in tax-related matters, ensuring compliance with relevant tax regulations and streamlining the preparation and filing process. 

In addition, you must ensure that the third-party service provider you choose has a background in tax laws applicable to your organization. This will guarantee that all the necessary information, including tax credits and deductions, are handled with precision and accuracy. 

2. Cost Savings

Cost savings is another significant advantage of outsourcing tax preparation. Compared to hiring an in-house team, outsourcing tax preparation lets you reduce overhead costs. Outsourcing companies with tax-related services have flexible pricing plans. They allow you to choose and select specific services that your company needs—whether it be seasonal, part-time or full-time. 

In addition to the services provided, the accounting outsourcing provider also takes care of the recruitment, training, and management of tax accounting professionals.   

However, you still have the option to train and provide the necessary software to ensure a smooth outsourcing engagement. This means that you can have peace of mind knowing that your tax-related matters are being handled by experts, while also saving on costs. 

Read: 8 Different Types of Outsourcing: Which one is for you? 

3. Focus on Core Business Functions

As mentioned above, rather than spending valuable time and resources on managing complex tax-related tasks, your in-house accounting department can redirect its focus on what really matters – that is, focusing on your core competencies and growing your business. 

4. Enhanced Data Security

Data security is a top concern when it comes to outsourcing, and these accounting outsourcing providers are fully aware of this, that is why they have robust measures in place to protect the information of each client. 

They also invest in advanced cybersecurity systems and compliance protocols to ensure the confidentiality and integrity of financial data. Hence, you can have peace of mind knowing that your data is in safe hands. 

5. Scalability and Flexibility

As your business grows and evolves, your tax preparation needs may change as well. The right third-service provider will provide and offer the flexibility and scalability required to adapt to these changing demands. Doing this will enable your firm to remain agile and responsive, no matter how your tax requirements may change over time. 

6. Ensuring Compliance and Specialized Knowledge

Let's be real; outsourcing your tax preparation means partnering with experts who stay constantly updated with ever-changing regulations, thus reducing the risk of tax errors. 

By entrusting such responsibility to a reliable third service provider, your company can safeguard its reputation and minimize potential negative consequences of regulatory violations or chances of costly penalties.  

Read Next: Outsourcing to the Philippines: Benefits & Tips to Consider 

7. Technology Advancements and Automation

Lastly, investing in the right tool is necessary to make your tax preparation as accurate and insightful as possible. Fortunately, there is a service provider that recognizes the significance of adopting the latest technology advancements and automation tools to effectively fulfill their responsibilities. 

By prioritizing the integration of cutting-edge technology, this outsourcing service provider ensures that their team is fully equipped to deliver exceptional results. They also actively collaborate with their partners to thoroughly assess and tailor their technology solutions, guaranteeing a seamless fit with your firm. 

The Bottom Line 

Delegating your tax preparation tasks to a third service provider can be a beneficial move for your organization. But to unlock a plethora of benefits, you need to find a forward-thinking and reliable partner to handle these tasks. 

In Need of a Reliable Accounting Outsourcing Provider? 

Consider D&V Philippines. With over a decade of experience in the industry and trusted by numerous firms across the globe, we provide reliable tax management support to help you focus on your core responsibilities. 

Our team of experts undergoes rigorous training to stay up-to-date with the latest tax regulations and best practices. We understand the unique challenges faced by CFOs in tax management and offer specialized solutions tailored to your needs. Schedule a free consultation with us today to learn more how we can help you. 

You can also read our Whitepaper Premium CFO Solutions guide to gain a deeper understanding of the tax preparation support we offer to corporate CFOs.