Director Alex Mann presents the Tax Technology market report for June...
Following the trajectory of Q2 tax recruitment in general, we are also seeing an uptick in the demand for dedicated tax technology skills.
Prior to the interruption of a global pandemic, a steady increase in hiring across professional services and the tax software houses was prevalent, coupled with more cases of in-house tax functions winning their pitch for investment into technology hiring. Of course, this trend had largely dipped when purse strings were tightened and began to reemerge in Q4 2020 to Q1 2021 with some Big 4 hiring. However, it now feels like we are in a position to pick up from where we left off.
As tax leaders navigate legislative minefields and stay abreast from the rising tide of compliance and reporting obligations, the demand for in-house technology and data skills remains high.
Despite the growing need, however, conveying this to the wider business remains an issue. Almost every week we speak with frustrated managers and leaders who face an uphill battle in getting tax seen as functionality for software as well as those who highlight the department’s disconnect with IT teams who simply do not understand the nuances of tax.
Highlighting the business case for investment into tax technology will continue to be a top priority for tax leaders but, as we complete another quarter, it’s encouraging to see more businesses who being successful in this negotiation and releasing in-house vacancies onto the market.
Indeed, there are still only flurries of activity in this space across European (primarily the UK, Netherlands, and Germany) and no real rhyme or reason as to what types of skills are most sought after across the tax technology spectrum.
However, while this part of the tax recruitment market pales in comparison to the demand for more traditional tax profiles, from our assessment we continue to follow the ‘two-jobs-a-month’ trend for pure tax technology in-house roles across the UK&I, BENELUX, and DACH markets. If you really bent our arm to identify a trend, there has been a frequent demand to identify candidates with specific tax engine experience, notably across indirect tax for ONESOURCE or Vertex experience.
One area where we are yet to see any pure technology roles but have identified more signs of hybrid roles is customs. With the administrative burden from Brexit and other trade complexities, there is a massive shift being made into the automation of operations to ease the stress of manual procedures and we can certainly predict there will continue to be a larger focus on the development of customs technology going forward.
Recruitment within the accounting firms and tax software houses continues to be the nucleus of tax technology hiring.
Across the Big 4, the key demands have largely been to expand the bench of tax transformation advisors and also SAP S4 Hana specialists.
Outside of the Big 4, recruitment is lower in volume but has ranged from robotics hires to bringing in compliance specialists into tax engine focused roles. Invariably, the tax software houses are continuing to offer more variety with firms - both big and small - providing some excellent routes for tax professionals to explore different avenues, ranging from proposition management, strategic alliance, solutions, and sales engineering.
Our outlook for Q3 is that we will likely replicate the past few months of activity, with the largest concentration of hiring being in the Big 4 and tax software companies. This leaves a selection of technology and data focused roles to emerge within the more mature in-house tax functions.
Looking beyond Q3 to the bigger picture of 2021 - and certainly throughout 2022-23 - we are closely monitoring the e-invoicing space. With both European and non-European jurisdictions introducing new e-invoicing models and leveraging PEPPOL infrastructure, we suspect that there will be an increased need for in-house e-invoicing profiles to help tax functions stay abreast of both current and upcoming legislation.
Over recent years, we’ve seen the majority of these professionals coming from the pioneers of this movement, Italy but, with more European and non-European jurisdictions adopting this model, we suspect that there will be an international demand for experts who can navigate tax functions through this space. The recruitment challenge for hiring managers is that, unless we see harmonisation across member states, the demand will be for candidates who hold the knowledge to operate across different countries.
So for those on the VAT side who are looking for avenues into a more systems and data driven career, this is a big talking point that the Harvey John team are having right now. Speaking to the experts in this space, the advice for VAT specialists is to start taking the time to understand where data sits in ERP systems, how an e-file is composed, and get familiar with XML!
Alex Mann is Associate Director, Indirect Tax & Tax Technology at Harvey John
For expert advice on how to get the best out of your tax career, whether in a professional services firm or in-house, contact us today.
Harvey John is a specialist Accountancy, Tax & Treasury, and Legal recruiter operating across the UK & EMEA market