COTS (Commercial Off the Shelf) Digital Tax Administration System

Governments Worldwide Are Partnering With Qualysoft for the Digital Transformation of the Tax Administration

Overview

Taxes keep our communities up and running. They balance government budgets and create funding for public initiatives. Investments in key priorities like education, healthcare, and infrastructure depend on the government’s ability to sustain the future evolution of the economy and society by generating revenue.

Tax administrations worldwide are undertaking the digital transformation and automation of their systems. Only with the adoption of technology, governments can enable successful and sustainable tax reforms, ensure the proper taxation of the digital economy, and reduce the obstacles to compliance.

On the government’s side, it drives better tax compliance rates and increases revenue, reduces tax collection costs, empowering employees to deliver new higher-value services to taxpayers by easing the administrative burden.

On the other side, for most citizens, paying taxes is among the most challenging and time-consuming interactions with the government. Support them by simplifying taxpayer services like filing, reporting, and paying various taxes, easily from home or work, through the Internet, and increase their satisfaction, trust in the authorities, and compliance.

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Why a Commercial Off‐the‐Shelf Solution?

Qualysoft’s solution to your government’s digital transformation is a customizable, tried and tested commercial off‐the‐shelf solution (COTS). With our knowledge and expertise, we seamlessly customize it to your specific needs. The benefits of our solution are: 

  • A performant, fully integrated COTS software solution, tried and tested by tax administrations in Indonesia and Albania; 

  • One single solution that supports all duties of every tax administration;

  • Refined best practices regarding processes and procedures; 

  • Reasonable future development costs, shared with other customers; 

  • Implementation track record; 

  • Cutting-edge technology stack; 

  • Shorter implementation timescales than similar solutions; 

  • Easily integrated, configured, and adapted to every fiscal system; 

  • Rigorous testing and deployment methodologies; 

  • A payback period of under 12 months in our project delivered in Indonesia. 

Functions / Modules

COTS is a comprehensive tax administration solution composed of two main components: COTS Core and COTS Public (Taxpayer Portal​​​​).

COTS Core is an extensive system designed to support tax administration by automating and managing all the necessary processes. It covers all aspects of modern tax administration and it is highly configurable to meet the legal requirements and specific needs of the government department. With its flexible and modular design, COTS Core ensures seamless integration of different functionalities, including taxpayer registration, tax assessment, payment processing, audit support, and compliance monitoring. 

COTS Core System has the following modules:

Taxpayer Registration

The process of capturing taxpayer details, completing manual tasks, and generating registration documents in PDF format. The taxpayer details include their name, address, existing tax numbers, and contact details, and may vary depending on the tax regime. The system assigns a tax number for successful registrations and dispatches generated documents via email.

Return Sheets

The process of creating return sheets for taxpayers, either for all tax regimes or individually per regime and tax period. The system assigns an expected return date for each return sheet based on the legal situation. Users can create individual return sheets at any time. Optionally, the return sheets can be printed and dispatched. Data capturing can be done online by the taxpayer or manually by a tax officer. The return sheets are designed to match the content and format of paper documents.

Automated Assessment of Non-Filers

The system automatically finds them and generates a report in a grid format that can be printed or exported. Tax officers can generate assessment letters and send them to the taxpayer. Assessment transactions and surcharges can be generated and charged to the taxpayer's account. Assessment calculations are based on averages from previous months, annual turnover, or a minimum amount depending on the tax type.

Accounting

The taxpayer is assigned one tax account to record all financial transactions. Debts and credits are recorded on the account, along with the tax type, revenue code, and transaction date. Payment records can be entered manually or loaded electronically. The system automatically calculates interest for late payments and reconciliation can be done through bottom-line accounting or transactions based on revenue code and period.

Tax Credits / Refunds

Refunds are generated and transferred to the taxpayer's account, and reports about tax credits and refunds can be generated. Additionally, tax credit and refund letters can be generated for the taxpayer to confirm the approval or rejection. The system also generates return sheets for taxpayers who have credits instead of debts. The option to transfer refunds to the taxpayer's account in the bank file depends on agreements with the bank and file structures received.

Taxation Enforcement

It's automated and flags unpaid account transactions without manual intervention. It involves finding and filtering unpaid transactions, generating reports, letters, surcharges, and enforcement transactions, debiting the taxpayer's account, and optionally dispatching enforcement letters. The process can be executed periodically with customizable parameters.

Taxation Risk Assessment

Allows for risk assessment based on rules defined by the administration, which can be based on individual fields or calculated values. These rules are combined to produce a "Tax Loss Score" which determines the risk level of the taxpayer. The risk assessment can be used to create periodic audit plans and automated audit orders to combat corruption.

Case Management

Allows users to create cases for various purposes such as appeals, certification, enforcement, audits, and debt management. Each case is configured to work with a specific workflow, and required documents are automatically produced without manual intervention. Documents can be synchronized to taxpayer portal depending on the case and document type.

Document Management

Enables automatic document creation using templates, and all document types can be made available on taxpayer portal to inform taxpayers. The document management system allows retrieval and management of all documents, including those uploaded by users.

COTS Testing Suite

Helps overcome challenges during the initial implementation and development of an IT project by providing the ability to specify and execute business cases for functional and process testing. Input parameters and expected results can be set up in various formats and the automated test suite compares the results. Detailed statistics are provided to assure software stability and sustainability, reducing the need for manual testing.

COTS Management Information System

Allows authorized users to execute predefined reports and process data using applications such as Microsoft Excel. The system provides predefined reports such as the Return Sheet Reception Overview and the Registration Procedure Overview.

Taxpayer Portal

COTS Public is also known as the taxpayer portal. It’s the front-end component of the system that is accessible to taxpayers through the internet. The taxpayer portal provides a user-friendly interface that allows taxpayers to easily view registration data, file tax returns, payrolls, sales and purchase books, and view accounting data. Users can also select a tax representative, access documents generated by the system, file cases, and submit balance sheets and stakeholder decisions. In conclusion, it sustains them with:

  • Filing tax returns;
  • Submitting payroll data;
  • Managing sales and purchasing books;
  • Viewing accounting records including liabilities, credits, payments, and interest penalties;
  • Managing tax representatives;
  • Filing cases (e.g. certification requests).

Architecture

Qualysoft provides 3 implementation possibilities for the system:

  • On-premise;
  • The cloud solution;
  • Hybrid – a combination of on-premise and cloud.

The cloud solution variants are:

Azure is a new cloud-based solution that uses latest Microsoft services as:

  • App Services;
  • SQL Server and SQL Databases;
  • Power BI Workspaces;
  • Storage Services;
  • App Service Plans;
  • Application Insights;
  • Data Factory Services;
  • Active Directory Services.

With this cloud solution, you can enjoy an all-in-one package that offers benefits such as cost minimization, reduced maintenance costs, and modern security measures. Additionally, COTS in Microsoft Azure is scalable, multi-tenant, and metadata-driven configurable, with no system downtimes apart from maintenance windows.

The technical architecture of our system is designed to meet the highest standards of modern web development. It is fully compatible with all major web browsers, including Microsoft Internet ExplorerMicrosoft EdgeGoogle Chrome, and Mozilla Firefox.

Our development process uses cutting-edge tools such as Visual Studio 2017 and Team Foundation Server 2017, which offer advanced features for source and version control. The system is developed using the latest technology stack, which includes C#, .NET core, .NET Framework, ASP.NET / MVC, Oracle, Dapper, CQRS, DDD, Event Sourcing, MassTransit, Kubernetes, Redis, Open Stack, PrimeNG, Angular, Docker, SQL Server, SSRS, SSIS, WebMVC, IIS, WCF, and Office.

To ensure optimal performance, the system is built on a multi-tier architecture that includes separate layers for data, data access, business logic, and presentation. It runs on Windows Server 2016 and uses either SQL Server 2016 or Oracle as the database management system. It also utilizes web services and a microservices architecture to provide scalable and resilient solutions.

The solid foundation of the system includes a core framework and can be easily customized to meet specific requirements. More than that it features:

  • Support for any tax type (VAT, income tax, property tax, excise, company tax and more);
  • Handling of any document type, revenue code, and process;
  • Easy development of additional modules;
  • Flexible and user-driven workflow configuration;
  • Various administrations and institutions can participate in specific processes through the use of user access to the system or web services, including one-stop registration and accounting;
  • Automated testing is supported across all system layers;
  • Dynamic rules engine for validating various documents, such as return sheets;
  • Easily translated automatically into any language needed​​​​​.

Six Reasons to Consider Qualysoft’s Tried and Tested Solution

In the end, we provide six reasons to consider Qualysoft's Commercial Off-The-Shelf (COTS) Tax Administration Solution:

  1. Tried-and-tested solution: Qualysoft's COTS Tax Administration Solution has been successfully deployed in multiple governments, providing assurance of its effectiveness and reliability.
  2. Cost-effective: COTS solutions are typically less expensive than custom-built solutions, and Qualysoft's Tax Administration Solution is no exception.
  3. Fast time-to-value: COTS solutions are available off-the-shelf, allowing for a quicker implementation and faster time-to-value compared to custom-built solutions.
  4. Scalable: Qualysoft's Tax Administration Solution is designed to be scalable, allowing government departments to easily add users or functionality as their needs change over time.
  5. Support and maintenance included: Qualysoft provides ongoing support and maintenance for its Digital Tax Administration Solution, ensuring that government departments receive the support they need to effectively use the solution over time.
  6. Easy to integrate: Qualysoft's Tax Administration Solution is designed to be easily integrated with other systems and solutions, providing a seamless experience for the users.​​​​​

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