Tax Intelligence

About the book

Tax is one of the largest financial risks facing any successful business — and most companies only discover the size of their exposure when the revenue authority comes knocking. Drawing on more than 120 lectures delivered to multinational corporations and smaller businesses, and on real case studies from decades of tax controversy practice, Prof. Daniel N. Erasmus shows exactly where companies habitually fail to recognize the tax exposure they face.

The book is built around seven habitual mistakes and the seven Tax Risk Management (TRM) steps that correct them: stop being reactive, build a proper tax team, compile a TRM strategy, become transparent, get the facts, self-audit your accounting, and communicate. At its core is a stark finding — typical number-driven tax compliance covers only about 40% of a business's total tax risk, while the other 60% stays hidden until it is exposed through systematic, people-to-people communication.

The case for the method is made with real numbers. One featured company, facing roughly $600 million in potential tax, penalties and interest across thirty audit areas, ran its own TRM process, self-disclosed to the revenue authority, and settled for a fraction of that amount — at about a third of the defense costs it would otherwise have incurred. Along the way the book delivers practical tools: SWOT-based tax risk analysis, on-the-radar and off-the-radar risk classification, the Tax Risk Matrix and defense files, using legal privilege correctly, handling revenue authority queries, and the reporting demands of SOX 404, FIN 48 and IFRS.

Prof. Erasmus is an adjunct Professor of Law at Thomas Jefferson School of Law, an admitted attorney who has represented multinationals in tax disputes since 1987, and co-author of the IBFD volume Tax Risk Management: From Risk to Opportunity. This is proactive tax risk management from someone who has spent a career on the front line between taxpayers and tax authorities.

“In matters of tax it is extremely dangerous not to be proactive.”Prof. Daniel N. Erasmus

What you’ll learn

• Why reactive tax compliance invites penalties and interest, and how a proactive TRM process puts control of tax risk back in the hands of the business instead of the revenue authority
• How to assemble a tax team — CFO or business owner, tax manager, outside advisors and a legal team — that expands tax risk cover from 40% to 100%
• How to compile a TRM strategy using SWOT analysis, on-the-radar and off-the-radar risk classification, a Tax Risk Matrix and defense files
• Why hard facts — not assumptions — are the starting point of every tax risk resolution, and how to gather them before applying technical expertise
• How to use legal privilege to protect sensitive tax information while investigating your own exposure
• Why 60% of tax risk stays hidden in most businesses, and how people-to-people communication and internal self-audits expose mistakes before the revenue authority does

Inside the book

1. Don't Be Reactive: Be Proactive
2. Not on Your Own: Create a Tax Team
3. Direction? Compile a TRM Strategy
4. Insular? Become More Transparent
5. More Facts Resolve Tax Risks
6. Internal Audits Fix Financial Accounting Problems
7. Communication to Eliminate Tax Risk
8. The Protectors for Big Business
9. Tax-Radar