Mastering Tax to avoid one-way doors

Expanding with confidence

Three ways “getting tax” will help you win at expansion and growth activity (new products, services, new employee footprints and targeting/marketing activity):

1. Choosing the right corporate structure is crucial. Misaligning your business structure with your business activities can lead to criminal penalties, onerous operational restrictions and require costly restructuring efforts which are time-intensive and disruptive. This is all effort that can be better spent doing what you do best - growing the business! Consider which business activities are mission-critical to your operations i.e. local presence, contract negotiations and execution, marketing/PR/media efforts in country and whether you plan to hire senior talent in country. All of these things are key considerations. Getting it right upfront can save you $10M+ in costs and a lot of stress by doing it right from the beginning.

2. Understand where your products/services are sold from/to customers. This will determine the business and compliance impact of operating in a new country and determine what it will cost to meet the compliance needs there (e.g. e-invoicing requirements, real time government reporting in specific formats and value added taxes that cut into your bottom line). Know what assets your business uses to generate revenue and whether there needs to be a restructure of assets or new transfer pricing changes to your group before you launch. Best to know this before you commit to a plan and to leave sufficient time to make this happen to avoid delays.

3. Brief early. If you build your GTM plan with a clear view of what tax compliance requirements will apply, then you can optimise for a user friendly customer experience that also raises the bar.

Moral of the story - yes tax is complicated, but being curious about how it works and building strong relationships with your tax advisors help you become a better business leader and owner.

At Venture Bench, I act as the glue between the business and your advisors to make sure we factor all of these issues in, turn complex advisor speak into practical commercial inputs and help you move fast to make smart informed decisions that save you time and money. Asking for forgiveness after the fact, won’t solve save you from one way door decisions that have already been made and acted on.

Ps shout out to all my tax buddies. Let’s find new ways to collaborate on something fun together!