Last updated on July 15th, 2022
According to Forbes, 83% of enterprise work will be done on the cloud by the year 2020.
Cloud technology has changed the way of carrying out different business processes; taxation is no different. Generally, professionals face various issues while filing tax returns like the security of client data, team collaboration on the same platform, and remote access to the tax files, to name a few.
Cloud technology helps solve all these problems and increases the efficiency and productivity of the workflow. Here are some main benefits of using the cloud for taxing processes:
1. Anytime, Anywhere Access to Data
One of the most significant advantages of cloud computing is real-time access to data, as it promotes the mobility of employees. This means that an employee can work from any remote location and deliver the results efficiently. It eliminates the compatibility issues faced while using different devices and operating systems.
Similarly, a tax process, when migrated to the cloud, offers better accessibility of tax data and software for the preparers. Tax professionals can easily keep track of important files and documents.
This remote access feature of cloud not only helps in saving time and transportation costs but also enables better work-life balance.
2. Security Of Data
Despite the common misconception, data stored on the cloud is much safer than data stored on a local system. Since the data is not stored on a single device but redundant cloud servers, it reduces the chances of any accidental data loss due to hardware malfunction or device theft.
Tax software hosting on the cloud ensures that the confidentiality of data is maintained and secured.
Most cloud service providers implement various measures to ensure data safety from security threats like malware attacks, hardware theft, DDoS attacks, etc. The tax data is stored with multiple levels of security which includes anti-virus, anti-malware, end-to-end encryption, IDS/IPS (Intrusion Detection System/ Intrusion Prevention System), multiple-firewalls, and regular backups.
Moreover, there are some tax software hosting providers that offer Business Continuity and Disaster Recovery plans. Herein the data is automatically backed up on a daily basis to geographically-distinct data centers. This ensures redundancy of the critical data and recovery of the same even during the times of natural calamity.
3. Multi-user Collaboration
One of the many ways in which cloud saves time is by allowing multiple users to work on the same data at the same time. Collaborating with the team on a common cloud platform improves efficiency and accuracy in the workflow.
The tax professionals can collaborate with CPAs and accountants to get all the financial information required for the tax filing processes.
This allows faster tax filing as one doesn’t have to wait for another to complete its task. Cloud allows only authorized users to access the data and files. Cloud hosting of the tax software further enables transparency within the system by providing real-time tracking of tax returns, billing, payrolls, employee performance, and more.
4. Integration of Add-ons
It is always better to have the combined functionality of two or more applications compared to that of a single software. Tax software can be integrated with third-party applications for automatic data importing, document organization, seamless e-filing, integrated tax research, etc.
Cloud hosting allows integration of add-ons with the tax software to improve the productivity and efficiency of the workflow. Moreover, there is no restriction on the number of add-ons that can be integrated with the tax software, when it is hosted on the cloud.
For example, Drake tax software can integrate with QuickBooks accounting software to automate the accounting data entry work into the tax software.
As the business grows, the requirements of the resources grow along with it. Therefore, there is a constant need for a strategy to upscale the resources like storage space, the number of users, RAM, etc. as per the requirement of the business. Cloud technology helps to upscale and downscale the resources accordingly.
Tax software hosting helps businesses to scale up or down the resources without worrying about the hardware cost and investing money in the local infrastructure. It becomes convenient to add, remove, or modify the number of authorized users in a system.
The major cloud hosting providers in the market offer pay-as-you-go pricing to fit every firm’s needs. This ensures that tax preparers pay only for what they’re utilizing. Cloud also saves the cost for maintenance of hardware infrastructure.
6. Green Computing
It is essential to implement eco-friendly methods when it comes to business operations. But every business finds it hard to compromise on its growth for the environment.
One of the best solutions for this issue is to opt for cloud computing. Cloud computing has helped in reducing electronic waste of hardware resources and reduced power consumption.
Hosting the tax software on the cloud contributes towards fewer carbon footprints and helps save energy costs. Cloud computing promotes the idea of BYOD (Bring Your Own Device), which in turn reduces the cost spent on desktop systems or laptops.
Also, it is recommended to opt for the cloud service provider that uses green data centers for storage and management of data. These data centers provide maximum efficiency in terms of power consumption and have a positive impact on the environment.
To Wrap Up!
Cloud computing is the future of taxation. It has not only made the tax filing process faster and more reliable but also helped in saving time and money by many folds. Hosting any tax software on the cloud helps businesses to stay ahead in the competition by eliminating problems like data inaccessibility. Hence, it has become a crucial part of the business plan of most companies.
To know more about moving the tax process on the cloud and other cloud hosting related queries, connect with our Solutions Consultant at 855-223-4887.
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