Accounting Software and Apps
How Small Businesses Can Optimize Their Tax Process With Cloud Technology
According to survey results published in Small Business Trends, 79% of small business owners find it difficult to handle their payroll taxes.
Tax filing is one of the most demanding tasks for any business. Especially if you run a startup or a small business, you will find that there are many factors you must consider for a seamless tax process. This includes gathering necessary documents, establishing an effective communication system, implementing security measures, and much more.
Hence, there’s a need for a flexible solution that can handle all the tax and accounting-related tasks. One such approach is the implementation of cloud technology within the system. It is a one-stop solution that offers a plethora of benefits to help your business succeed in the long run.
Here’s how you, as a small business owner, can optimize your tax process with the use of cloud technology.
1. Access Data At Any Time From Around The Globe
A small business often demands long and odd working hours in its initial stages. Relying on the office desktop for your tax processes means that you have to be in the office all the time to complete your tasks.
According to a survey by Owl Labs, 83% of the respondents answered that remote working makes them happier.
Adopting cloud technology for tax and accounting tasks offer mobility and flexibility to access files and documents from any internet-connected device like laptop, smartphones, or tablet from any remote location.
Also, you can have real-time access to your accounting and tax software if you host them on the cloud servers. Hence, you can work even from the comfort of your home. It further helps to improve the satisfaction rate among your team and increase productivity.
Moreover, the cloud enables you to connect with the workforce from anywhere and expand your business to a global level. You can hire talent without considering any geographical boundaries and build the best possible team for your SMB.
This is especially important during unprecedented times such as these, when the COVID-19 crisis is forcing many businesses to operate remotely.
2. Improve Transparency Within The System
For your small business to be successful, you need to establish a communication system to share necessary information and files with your employees, partners or clients.
Also, during busy times, such as tax season, small business owners often have to outsource some of the services to accomplish the tasks on time. To ensure authenticity, you need to keep track of the workflow. Moving your tax and accounting practice to the cloud provides real-time metrics to control the work progress and get live reports on the process.
Furthermore, it helps to improve transparency within the system. You can share updates with your clients, which can build trust and credibility of your small business in the market.
3. Safeguard Information With Enhanced Security Measures
According to Small Business Trends, 43% of cyberattacks make small businesses their target.
Tax data contains confidential information of a company. Therefore, it is crucial to ensure the safety of your data.
Most cloud hosting providers take various measures to protect this information from different security threats. Some of the advanced methods deployed by cloud service providers include data encryption, multi-factor authentication, traffic analysis, multiple firewalls, DDoS protection, antivirus, and anti-malware system.
Hence, by migrating the tax application and data to the cloud, you can mitigate the damage caused by malicious attacks and data breaches so that you can file taxes without any worries.
4. Utilize Scalable Resources As Per Requirements
SMB and startup owners have to wear many hats to manage all aspects of their business. One of the most time-consuming tasks in the process is the constant need to manage and upgrade hardware resources. As your organization starts to grow, you need to expand your hardware setup with resources like storage, the number of users, RAM, processing power and more to fulfill the business demands.
Moving your practice to the cloud enables you to upscale or downscale the resources as per the demands. For example, during tax season, the requirement of operational resources (such as employees) increases. To counter this, you can control the scalability of resources with the help of the cloud. Also, most of cloud service providers offer flexible pricing plans so that you pay for only what you are using.
Moreover, your tax processes might rely on an accounting application for the accomplishment of tax processes. Most of the time, there is a need to integrate these applications with different add-ons to improve their functionality. This might degrade the performance of the software.
Hosting the tax software on the cloud enables you to upscale the RAM and storage of the server. This further allows you to integrate with any number of add-ons without compromising with its performance.
5. Get Data Backup On Regular Basis
Storing your financial data on a local device might pose some threats and downtime that affect business continuity. It can be due to accidental losses like hardware failure, natural disasters, or technical errors.
Adopting cloud technology ensures that your data backup is taken on a daily basis in state-of-the-art data centers. Moreover, most of the cloud hosting providers offer disaster recovery solutions by hosting the business process on multiple data centers that are geographically isolated. This helps to safeguard the tax information from all disruptive events.
Also, the competent cloud hosting providers guarantee an uptime of 99.999 percent, ensuring that data is accessible when you need it. However, it is important to read the SLA (Service Level Agreement) of the hosting provider to check for their uptime guarantee.
6. Reduce Operational And IT Infrastructure Cost
Every business needs to invest in advanced infrastructure and hire IT professionals to cater to client needs. There is a need to look out for cost-efficient solutions that can fulfill the requirements without compromising the growth of the company.
Cloud enables you to work from any internet-connected device and helps to promote policies like BYOD (Bring Your Own Device) and work-from-home. This, in turn, helps to minimize capital and travel expenses.
Also, most of the cloud hosting providers offer pay-as-you-go pricing plans that depend upon the usage of resources. Additionally, you get a dedicated support team to troubleshoot any IT-related issues, saving the cost of hiring in-house professionals.
In A Nutshell
Cloud technology is one of the best solutions to streamline the tax process of your small business. It will surely help you to yield desirable results and overcome any potential obstacles for the growth of your business.
Bhavleen Kaur is a technical content writer at Ace Cloud Hosting, a renowned application hosting provider in the accounting and tax industry. In her free time, one can find her reading novels or watching movies.
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