Real-time reporting models compared

Introduction Many governments all over the world are currently deciding what type of real-time reporting system they want to implement. With this blog post we hope to assist these governments by showing various design options of real-time reporting. In the following we will analyse four different real-time reporting solutions after which we will compare those with summitto’s own real-time reporting solution: TX++. We will explain that TX++ can achieve the same results as any other real-time reporting system, while at the same time:

Real-time reporting and corporate income tax fraud

In many of our articles, we have analysed the potential of real-time reporting in tackling VAT fraud while producing benefits for businesses. Nevertheless, real-time reporting systems can be a valuable tool also in the fight against corporate income tax fraud. In this article, we will better explain how this is made possible and what are the benefits for tax authorities and businesses. What is real-time reporting Real-time reporting is an innovative solution to tackle fraud and increase country revenues.

Real-time reporting and the definitive VAT system

Introduction The latest European Commission, Fiscalis and VAT Expert Group meetings and the developments in multiple EU Member States show that real-time reporting (or Transaction-Based Reporting) is seen as the most feasible solution to VAT fraud. However, the idea of moving towards a definitive VAT system where the exemption on intra-Community VAT is removed, is also still being considered by the European Commission. In the following we will show that implementing one doesn’t need to exclude the other and that both can be perfectly combined.

Securitisation of future VAT income

Introduction Real-time reporting is on the rise around the world. While it’s main goal is to tackle VAT fraud, there are many other applications of this tool. However, these applications depend on choices made during the design phase of real-time reporting. One of the major design choices to look at is whether the registered VAT data is made publicly verifiable. Previously we have shown that this can help businesses to e.

The Mexican model of real-time reporting part 2: The benefits and inherent issues of having a network of certified third parties

In the first part of our overview of the Mexican network clearance model, we explained how the Mexican Tax Administration (SAT) implemented its Comprobante Fiscal Digital por Internet (CFDI), its XML e-invoicing format, in 2011. To validate and control the invoices, PAC entities (Proveedor Autorizado de Certificación) are carrying out tax duties on behalf of the SAT. In the following article, we will review the benefits of having a network of certified third parties, and some of the inherent structural issues.

The Mexican model of real-time reporting part 1: what is it?

France is considering the ‘Mexican’ real-time reporting model. As it is not clear for every VAT practitioner what this model actually entails, we thought it would be interesting to take a deep dive into one of the pioneers of tax digitalisation: Mexico. The Mexican model, also referred to as the network clearance model, requires companies to send their invoices to certified third party service providers. These trusted third party service providers are responsible for controlling, approving and forwarding invoices.

Cross-post German business association DMB: the benefits of real-time reporting systems for SMEs

Introduction We are honored by this week’s opportunity to publish an expert article through the German Association DMB, representing 24.000 German small- and medium-sized enterprises (SMEs). As more and more countries are implementing real-time reporting systems for VAT purposes, it is important to look at the implementation details. We highlight four characteristics that any real-time reporting system should have to ensure feasibility and advantages for businesses. Feel free to read the German version here: https://www.

The relationship between real-time reporting and e-invoicing

Often confused, e-invoicing and real-time reporting mechanisms are, nonetheless, distinct and entailing specific services. While e-invoicing refers to the exchange of an invoice in a structured, computer readable data format, allowing its automatic and electronic processing;[1] real-time reporting refers to the reporting of relevant invoice data to the tax authority.[2] Although both mechanisms can be implemented hand-in-hand, they can also be successful on their own. In the following, we will explain the difference between real-time reporting and e-invoicing and how they relate to each other.

Real-time reporting: increase competitiveness through easier compliance

Complying with all regulatory requirements sometimes seems to be a burden whose only effect is to slow down businesses’ efficiency. Managing the VAT quarterly payments, filing for VAT returns, and constantly producing invoices can be stressful and time-consuming tasks. Nevertheless, modern technology can help businesses to comply with the VAT requirements while also increasing their competitiveness. The process of the digitalisation of taxation is having a relevant impact on the time required for VAT compliance all over the world.

A boost for modern technologies in real-time reporting systems - given by the German Bundesrechnungshof

SUMMARY Real-time reporting systems, in which companies are required to register their invoices with the tax authority, experience a big political push across the globe. By now it is not a question of if, but of when and how real-time reporting systems will be implemented by other states. Thus, focus needs to shift towards design requirements. Very recently, a clear recommendation has been made by the German Bundesrechnungshof: real-time reporting should be connected to blockchain technology to ensure timely and authentic data.