Will we have to file all business costs monthly? It’s a SAF bet

Last week’s news round-up related that the UK had taken a lead in the data it expects companies to publish about itself. That remains true. The transparency UK government wants in place by 2016 still goes beyond EU legislation.

But recent information from NetSuite suggests that our European cousins have the jump on us in another discipline.

Transmission of tax information to auditors and government authorities will be by way of a standardised document. Known as a SAF, these documents already form part and parcel of some member states’ monthly tax submission process.

Europe to conform to rigorous standards

SAF files aren’t a European invention. Rather, it’s to the OECD that we have to look for their origin.

In its most basic form, the file is written in XML. Not that there’s anything basic about coding for the layman.

But that’s where people like NetSuite come in. They play the middle man’s role, giving businesses a UI that’s in English (or Portuguese, French, Dutch, German – all countries already some way down the line with SAF). Not that having an intermediary is in any way convoluted or open to criticism, of course. 😉

Example of XML in Portuguese

Example of XML in Portuguese

Portugal have took the SAF document to heart and made it a staple of their audit. Portuguese businesses have no choice but to file their file once a month.

Last week, we alluded that member states adopting a uniform way of presenting their tax audit information was improbable. But there’s an app for that!

Different countries have different demands and ways of working. Indigenous criteria drive their economy, so we can’t all bat on the same playing field.

Again, this isn’t so much of a problem if everyone’s using the basic, generic document, even if they ‘tweak it’ a bit to suit their own rules and regs.

Mexico, for example, had such a need. Such is the advancement of cloud technology, a bolt-on app was all it took to get the Mexicans’ information communicating with the database.

What will the SAF document require?

Companies will have to record their data in either the aforementioned XML format. Or in a CSV file – plain text spreadsheets, for want of a better description.

Kamlesh Rajyaguru gives us an overview of what authorities typically want included for their audit offices. Like we say, it can differ from country to country.

Rajyaguru, NetSuite’s Director of International Products, tells us that all manner of company accounting information appears on the files:

  • receipts and expenses;
  • VAT returns;
  • sales invoices…
    • …to name a few.

Rajyaguru goes on to explain that, whilst audit offices regularly see VAT returns, they don’t see the other costs that make a business tick. All that could be about to change, and not just in Europe.

If we stick with Europe, reporting all business transactions every month may become the norm. It’s burdensome, yes. But at least with a uniform document that’s (hopefully) user friendly, it should ease the pain.

“What will be permissible as expenses?” will be the next big thing. There’ll no doubt be a file for that, too.

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