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Outsourcing and the in-house tax function

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I think [the in-house tax function] will become more integrated and more relevant. That’s not to say it is not already, but SAO (senior accounting officer regime) and the media coverage really forces a Board’s hand. There will always be a place [for outsourcing], but fashions and methods fluctuate. Technology does make outsourcing easier to manage, particularly on a global stage. However, SAO requires greater visibility and control so on balance I would expect a greater role for in-house functions.

David Campkin, group tax manager, BBC – Tax Journal, 27 September 2013

I think there’s the potential for lots of different models to develop as technology increasingly changes how and where we work, but I’d hope to see something of a shift towards a more organic, integrated way of working. If this happens, tax professionals could end up delivering advice to internal customers as part of a broader service team instead of as a stand-alone function. This would mean more (and earlier) tax input into a transaction or project.

Pippa Johnson, former head of group tax, National Rail – Tax Journal, 5 July 2013

With a trend towards more international and cross-border trading, I certainly can’t see the pressures on tax functions being reduced. As issues which have unusual tax implications become more routinely encountered by more areas of a business, tax people will have to be more closely attuned to what’s going on, to provide useful advice and to design processes to cope. In practice, this largely means being more proactive, communicating more effectively and building stronger relationships with people in the business.

Mark Dyson, head of tax, Debenhams – Tax Journal, 7 June 2013

I think there will be more moves towards retaining work in-house; SAO has meant that companies shouldn’t reply for others and, in any event, I think that in-house is the only way to truly be in control of your own tax affairs.

Sandy Frew, director of tax, ITV – Tax Journal, 18 April 2013

We need to stay close to the business, and develop project management skills. I’ve no plans to outsource. I want to retain control of my computations, as that’s the efficient route to high quality tax returns and reporting. We’re a complex business with complex systems and I’ve invested in a high quality team.

Rob Clayton, group director of tax, RSA – Tax Journal, 27 March 2013

I am not a fan [of outsourcing in tax]. Certainly standardising and ‘offshoring’ routine and transactional processes can drive down compliance costs, but it is important that responsibility and ownership is retained in-house.

John Connors, group director of tax, Vodafone – Tax Journal, 21 March 2013

I think the SAO is taking us down a route where in-house professionals become more of an oversight function, i.e. as a second line of defence, responsible for setting the tax strategy and tax policies and monitoring the adequacy of controls. [Whether or not to outsource in tax] boils down to economics. We outsourced some CT returns for property companies – it was low added value work, and cheaper than paying a property tax expert to sit around for most of the year.

Simon Burke, group tax director, Legal & General – Tax Journal, 1 March 2013

Both [insourcing and outsourcing in tax] can have their place in any organisation – we have very successful current experiences in both areas. However in managing such relationships I have also learned that you cannot outsource risk. Ultimately, if things do go wrong, you and the company will be held to account and in the strive for efficiency this needs to be taken into account.

John Bartlett, group head of tax, BP – Tax Journal, 30 January 2013

The above views were published in Tax Journal's 'One minute with' feature.