Value Chain

The tax documentation that is available to many companies often describes a business model that isn’t fully in line with the company’s actual model. Whether or not this is the case in your company merely depends on whether or not the board of your company is involved in describing the functioning of your organisation. Often this is not the case. The tax advisor or tax manager comes up with the necessary information and that’s it. Compliance conditions fulfilled. But here too, life is changing.

A sound description of the value chain serves more than one purpose. First of all, it’s the basis for your documentation. Once the documentation is supported by a realistic description of the business it becomes more valuable. Secondly, a well-described business model helps optimise your tax position because it will give you a better understanding of how your company works, also from a tax perspective. And thirdly, you will learn that tax audits will be a part of your new annual routine in this new world of international taxation. A factual description of your business, however, will give the tax administration one less thing to talk about; the facts. This, in turn, will help you solve the real question: ‘Did we, or did we not pay enough tax in this country?’

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