Tax Outsourcing and the Convergence of the Service Provider Landscape

Current cost pressures and the increased need for regulatory compliance to avoid costly penalties from tax authorities have accelerated the adoption of tax outsourcing. Tax outsourcing lowers operating costs for organizations and provides them access to better quality, scalable talent and the ability to transform their tax functions. Organizations are leveraging tax providers’ services through various constructs such as tax advisory, technology support, managed services, and tax CoE setups.

In this report, we explore the capabilities of different types of tax providers, such as the Big 4s, tax specialists, and traditional F&A managed services providers. Furthermore, we explore how the convergence of providers’ capabilities will likely characterize the tax service provider landscape’s future, as providers aim to be the jacks of all trades beyond their current primary area(s) of focus.