advertisement
Personal Finance

Tech can keep you in good books during tax season

calculations
The world has moved from manual payroll calculations. FILE PHOTO | NMG 

The end of the tax-year is looming in Kenya and Tanzania, challenging businesses to accelerate their efforts to comply with the laws and regulations around the collection of pay-as-you-earn (Paye) tax and the submission of tax returns.

Companies have only a few short weeks to get their houses in order. With tax authorities across the region taking a strict line on tax compliance, businesses of all sizes must ensure that they declare correct earnings for all employees and that they include the right statutory deductions in payroll calculations. Those that do not meet their obligations are penalised.

With the Kenya Revenue Authority (KRA) falling short of its tax collection target for the year, it is expected to take a tough stance on non-compliance. It is targeting Sh56.6 billion lost through tax evasion from 152 cases presented in court since July, for example.

The Tanzania Revenue Authority, meanwhile, has ambitious tax collection targets and has invested in technology and awareness programmes as part of its effort to widen the tax base.

Governments need more money to invest and to spend. As tax authorities continue to tighten processes and digitise systems, it is becoming harder to escape the tax net.

advertisement

The quickest, simplest and, ultimately, most cost-effective way for companies to ensure full compliance with payroll tax laws is to automate the payroll with modern software.

Using spreadsheets and other manual systems is time-consuming and less accurate than automated software.

Cloud-based payroll solutions make it easy to generate reports and calculate relevant taxes. Software makes it simpler to keep track of changes to tax regulations that impact the payroll, such as changes to the tax bands or changes to calculation of statutory deductions.

Automation saves time, frees up time to focus on growing businesses and serving customers. Payroll should not be a chore; it should be a seamless, error-free process that makes it simple to breeze through your pay run each month.

The writer is director for Sage in East Africa.

advertisement