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Tax transformation trends survey

Talent reimagined

In this second report of the Tax Transformation Trends survey series, we tapped into the perspectives of 300+ tax and finance leaders with a focus on talent transformation. As companies look past the pandemic, they are asking their tax functions to play a bigger advisory role—with less resources and more responsibilities. In this era of change, leaders will need to think differently to stay ahead of the curve.

Get ready to reimagine your tax function, today.

  1. Automating compliance and reporting work and/or migrating it out of tax to shared service centres (SSCs) and outsourcers, in the process freeing up their talent to perform higher-value advisory work.

  2. Developing hybrid tax-technology professionals internally by encouraging tax specialists to master selected technology skills; this bypasses the imperative to hire ready-made professionals (who will not necessarily be widely available in the market) with this skill mix.

  3. Pairing their technology specialists with business analysts to address immediate tax challenges demanding technology solutions.

  4. Sourcing specialist tax-technology expertise from external consultants to execute specific projects or work longer-term in tandem with in-house specialists, in the process helping to develop the latter’s hybrid capabilities.

  5. Reconfiguring their teams more efficiently, recognising that not all their resources need to be full-time employees. Some are finding it easier and more effective to buy access to external talent with specialised tax-technology skills, rather than trying to build it internally by recruiting and training their own in-house teams.

  1. Upgrading team members’ advisory capabilities and communications skills, through training and other measures.

  2. Taking organisational steps to bring team members into closer proximity with other parts of the business.

  3. Devising ways of ensuring team cohesion, knowledge sharing and full data accessibility as remote and hybrid working regimes become the norm.

  4. Re-thinking which expertise is core to their business, deciding whether they need niche expertise in-house or whether they are better off buying access to it through external advisors who are specialised in the topic.

The future of tax talent

Rethinking the work, workforce, and workplace

As companies look beyond the pandemic, they are asking their tax functions to play a bigger advisory role. Tax leaders have been asked to provide strategic counsel on emerging issues on everything from new digital business models to sustainable transformation. They need to transform their technology infrastructures to free up team capacity, operate more efficiently, and use data more effectively. Meanwhile, all this change is happening during an unprecedented global shift to remote and hybrid working. These trends have profound implications for the future of the tax function: how the work gets done, the skills that make up the workforce, and how the workplace is defined.

Click here to download the executive summary report that highlights tax leader’s strategic perspectives on tax operations, talent, and technology.

Key Insight 1: Tax work

How has the work changed?

Key Insight 1: Tax work

There are dramatic shifts under way in how tax work is done—with change happening at an accelerated pace. Deeper automation rose to the top of the list as key priority for 41% of the tax leaders surveyed. Automation will alter the day-to-day roles of tax professionals and transform how compliance processes are managed.

Tax is leaving the tax department. We’re being pulled much closer into areas such as government relations and sustainability—it’s changing the balance of responsibilities for our team.

Mike Munoz, VP Tax and Treasurer, Suncor

Tax leaders are prioritising these strategies to help their teams manage compliance workloads

Increased automation and reliance on shared service centres are the top choices for tax leaders looking to leverage lower cost resource models for routine tax compliance work.

Tax leaders are prioritising these strategies to help their teams manage compliance workloads

Q. Which of these strategies will be most important in enabling a lower-cost resourcing model for processes and activities, such as in: tax provision, transfer pricing documentation, corporate income tax returns and payments, etc.

Base = 304. Respondents were able to select up to 3 options

Key insight 2: Tax workforce

How has the talent mix changed?
Respondents were able to select up to 3 options

Key insight 2: Tax workforce

Tax leaders recognize that their teams need entirely new technical skills, with data analytics (45%) and technology transformation (43%) at the top of their wish lists. However, these team members also need to flex their cross-business advisory (39%) and interfacing and education (35%) skills. This means they must upskill and diversify the roles on their teams to meet increasing business advisory demands.

What companies are looking for is a beautiful unicorn who knows everything about tax and everything about technology.

Tim Rupert, Professor of Accounting at Northeastern University

The future of the tax workforce

The elusive tax unicorn

The future of the tax workforce

Developing more tax hybrid professionals means that tax and finance leaders need to think much differently when it comes to recruiting and professional development. The ideal professional will have a blend of these skills and will aspire to grow in areas where they need to develop.

TAX LEGISLATIVE SPECIALIST/PROFESSIONAL

  • Deep tax technical knowledge

  • Detail-oriented, methodical thinker

  • Attuned to risk

  • Manages to deadlines

  • Skilled at planning and reporting

  • Understanding of tax authority expectations

  • Awareness of industry practice

TAX TECHNOLOGIST

  • Digital native and/or technologically-savvy

  • Data analytics and advanced visualisation skills

  • Financial modelling and forecasting

  • Understands ERP systems, cloud-based applications, robotics and emerging technology

  • Translator between tax and tech specialists

  • Prospective focus

STRATEGIC ADVISOR

  • Forward-thinking

  • Commercial mindset

  • Comfortable with ambiguity

  • Ability to simplify the complex

  • Translator between tax and business

  • Manage vision and purpose

  • Prospective focus

In reality this tax hybrid professional is like a unicorn, they do not truly exist with all of these skills as core strengths. The ideal professional will have some blend of these skills and will aspire to grow in areas where they need to develop.

You need to go and hire [the data and technology specialists], but it will take time for them to become productive. And the best thing to do, in my view, is to partner them with business analysts who understand banking and the business lines, because it’s when they start to talk the same language that you get the real lift.

Global Head of Tax, A global bank

Power pairings

Whichever route companies take to develop hybrid tax-technology professionals, it will take time. But few tax leaders can wait two or more years for this—their digital challenges are urgent. So, some are doing the next best thing: pairing technology specialists with business analysts or other specialists in the wider finance team to combine their expertise on specific projects.

Examples of pairings that work:

  1. Internal technology specialists with business analysts or others in finance.
  2. In-house tax specialists with tax-technology specialists from consulting firms experienced in technology transformation.
  3. Junior staff with analytics and software licences. They are digital natives who frequently have been introduced to data analytics and other technologies in university programmes. They are able to bring more value when given the tools and opportunity.

Key Insight 3: Tax workplace

Organizational and cultural shifts for the tax department

Key Insight 3: Tax workplace

For many tax functions, the pandemic caused remote and hybrid working models to become the norm sooner than they were expecting. The advantages—productivity and cost-efficiency gains—are tangible but, like other leaders facing similar work-pattern changes, tax leaders must think about the less tangible effects of remote working: Address skill and training gaps? Strengthening team cohesion for power pairings? And enabling staff to act as strategic advisors to the business in a remote-working culture?

You need to ensure that you don’t end up with the remote workforce becoming a disadvantaged employee group. There needs to be clarity about how they get visibility for strong performance and how opportunities and promotions are decided upon, among other things. You need to fully address these issues directly and transparently, and not just write them into corporate policy and hope that’s enough to effectively manage such a culture change.

Mike Munoz, VP Tax and Treasurer, Suncor

The main challenges of remote working for the tax department

The main challenges of remote working for the tax department

Q. What does your tax department view as the biggest challenges associated with embedding a remote-working model for the long term?

Base = 304. Respondents were able to select up to 3 options

A new paradigm for tax talent

The tax function as we’ve known it is becoming a thing of the past. For tax function leaders, it is essential to build tax teams that meet the evolving demands that the business requires—in a time where the nature of tax work is changing. It is no longer enough to be a master of one or in multiple areas of tax. Professionals must also move out of their previous comfort zones to engage systematically and strategically with other parts of the business to provide the tax advisory expertise needed. They need to think hard today about the what, the who, and the where of their tax operating model and how they will find and develop the people to deliver on the function’s elevated objectives. Many of the tax leaders taking part in our research are doing just that—and in several ways.

Operate with dynamic control in tax and finance

Explore the full report results for the Deloitte tax operations in focus study, the first of our Tax transformation trends survey series.

DOWNLOAD THE FULL REPORT (PDF)

Tax is leaving the tax department. We’re being pulled much closer into areas such as government relations and sustainability—it’s changing the balance of responsibilities for our team.

Mike Munoz, VP Tax and Treasurer, Suncor

In the first report in our three-part Deloitte tax transformation trends series, we learned that the tax department has reached a tipping point—forcing leaders to rethink their tax operating models. We learn in this second report that these changes have had a “butterfly effect” on the tax talent experience. In this report, we’ll discuss how the tax function has not been immune to these external forces of change—and give some practical advice on what to do about it.

Emily VanVleet, Partner of Deloitte Tax LLP, discusses how companies are turning to the tax function to play a more strategic advisory role post-pandemic on Accounting Today, read here.

Download the report

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