As the digital era picks up speed in Africa, countries are bringing their financial services online. One such service is tax, and an increasing number of countries are now processing these submissions digitally. South Africa, Zambia, Kenya and Botswana all boast quite sophisticated systems – however, just because it's digital, doesn't mean it's easy.

On the one hand, online tax processes have made it easier for both local and global payroll managers to submit reports. On the other hand, all the required information and necessary checks and balances, can be quite complex to navigate.

For example, Kenya's online tax system requires a substantial level of detail per sheet and tab – if any field is incorrectly filled in or accidentally left blank, then the submitted file won't be successfully validated.

This means that your payroll processes have to be far more comprehensive than they were in the past. Gone are the days when basic personal information was enough to load employees to the system and add them to the payroll. To successfully submit a digital tax form, payroll has to get digital too. As initially frustrating as this may be, payroll managers can't afford not to move with the times.

Let's take a closer look at the pros and the cons of digital tax in Africa – and how your company can enjoy all the benefits.

Digital delights

A manual tax submission means that an official representative of your company has to take the right documents to the relevant tax office. It's a lengthy and laborious process that involves standing in queues and gathering various stamps and signatures.

The benefit of submitting a tax form digitally is that anyone from your payroll team can log on and send it off. In other words, a London-based payroll manager can submit the company's Kenyan-based employees' tax information from the comfort of their desk.

As soon as the information has been submitted, it's either validated or not. If there are any issues, you will be notified immediately and the mistakes can be fixed online. Authorities in these countries also tend to use an automatic validation system. This means that tax offices are clearing their backlogs and processing submissions far faster.

Another virtue of digitisation is that it creates an audit trail. Users receive a proof of remittance and can access all individual account history online. Tax authorities can also check user stats and feedback to improve their services.

Digital devils

With digital tax returns, the devil is literally in the detail. Online submissions require a vast amount of information. An employee's car allowance, for example, can turn a seemingly straightforward submission into an administrative headache. In addition to information like the make of the car and mileage, you may also have to include details like the vehicle's engine size and the employee's specific type of social security number.

To get this right, payroll managers need to make sure that their employee on-boarding processes are thorough. It's crucial that you gather all the required employee information and details upfront – and double-check it. Get this right and come tax season, the online submission process will be far smoother and much more efficient.

While the digital tax process does mean that submissions can be made from anywhere in the world – payroll managers do need more in-country experience and knowledge. For example, if you oversee payroll for various African offices but have never gone further north than Johannesburg, you might not know that in some countries, an NRC has different digits to a TPIN number.

In fact, if you don't know the local lay of the land, Africa's online tax systems can be incredibly intimidating. There are some easy and very frustrating mistake to make – and due to many of these countries being new to the electronic submission process, it's difficult to track down the right person for assistance.

Help is at hand

The pros of doing tax and financial reporting digitally are significant and can greatly benefit your business. Of course, adapting to a new way of doing things - especially in unfamiliar territories - can be fraught with problems.

These potential cons can be avoided by enlisting the help of a professional payroll provider with good African business experience.

Only in the right hands can technology deliver on its promises, enabling greater efficiency, improved compliance and faster service.