We recently published an article on the five stages of tax tech maturity, which helps people responsible for indirect tax understand how advanced their operations are.

But understanding your maturity stage is just the beginning. The harder question is: how do you actually move forward?

Tax transformation doesn't happen by accident. It requires deliberate investment, organizational alignment, and the right sequencing. Try to jump from Ad-Hoc to Leading without building the foundations, and you'll end up with expensive tools that don't deliver value because the underlying processes are still broken.

The good news? There's a proven path. Organizations that successfully advance their tax maturity follow similar patterns: they start with quick wins that build momentum, invest strategically in platforms over point solutions, and align their teams around shared standards before chasing advanced capabilities.

Here's what that journey looks like in practice.

Why most transformation efforts stall

Before we talk about what works, let's address what doesn't.

The common trap: Companies see the vision of AI-enabled tax, get excited, and immediately start shopping for advanced solutions. They buy best-in-class tools, run pilots, and... see minimal impact.

Why? Because AI and advanced automation need clean, consistent, integrated data to work. If your tax IDs are validated inconsistently, your VAT determination requires constant overrides, and your compliance data lives in six different systems, no amount of AI will fix that.

The organizations that successfully transform don't skip steps. They build systematically:

1. Digitize and standardize the basics (validation, determination, reporting)
2. Integrate and consolidate onto unified platforms
3. Automate and monitor with risk-based intelligence
4. Layer AI on top of solid foundations

Each stage creates the conditions for the next one to succeed.

Starting point: Leadership sets the ambition

Progress begins when leadership reframes tax from a back-office compliance function to a strategic enabler. This isn't just rhetoric, it's about changing how tax is funded, measured, and integrated into business decisions.

Building the business case for your CFO to care about tax automation is the first step to ensuring your leadership team is bought into tax transformation.

When this is done well, this is what it looks like:

• CFOs and Chief Tax Officers agree on a target maturity state (e.g., "We need to reach Established across all markets within 18 months")
• Tax becomes part of product roadmap discussions, not an afterthought
• Investment is allocated based on risk and opportunity, not just regulatory mandates
• Success metrics shift from "returns filed on time" to "percentage of invoices accepted first time" and "days to enter new markets"

The cultural shift: Tax stops being seen as "the team that says no" and becomes "the team that makes yes possible faster."

Without this leadership commitment, transformation initiatives get underfunded, deprioritized when deadlines hit, and fragmented across regions that protect their local autonomy.

Stage 1 → 2: Quick wins that build momentum

Goal: Move from Ad-Hoc to Developing by digitizing the highest-risk, highest-volume processes.

Technology focus:

• Implement automated tax ID validation at supplier and customer onboarding
• Deploy a VAT determination engine that pulls rates automatically based on transaction attributes
• Introduce compliance software in your largest or most complex markets
• Set up e-invoicing in mandated jurisdictions

Why these specifically? They deliver immediate risk reduction and efficiency gains without requiring full platform transformation.

Real example: A European logistics giant was losing deals because customer onboarding took 7 hours. In fast-moving segments like air freight, prospects simply moved to competitors who could onboard them faster. To avoid losing revenue, they sometimes skipped VAT validation checks, leading to fraud where customers received goods but never paid due to invalid credentials.

They integrated real-time tax ID validation directly into their onboarding workflow.

Result: Onboarding time dropped from 7 hours to under 5 minutes. They're unlocking an estimated $9.1M in annual value through faster deal closure and fraud prevention.

Organizational moves:

• Document current processes (even if they're messy) to create visibility
• Assign clear ownership for validation, determination, and compliance
• Create standardized workflows that everyone follows, even if they're not fully automated yet

The unlock: You stop hemorrhaging time on preventable errors. Your team gets breathing room to think strategically instead of constantly firefighting.

Stage 2 → 3: Building the integrated foundation

Goal: Move from Developing to Established by eliminating fragmentation and creating consistent, enterprise-wide processes.

Technology focus:

• Replace regional point solutions with a unified tax platform
• Integrate tax validation directly into transaction flows (not just onboarding)
• Implement a central VAT determination engine that serves all systems
• Connect compliance reporting to source systems so data flows automatically
• Connect e-invoicing with billing and procurement systems through a chosen single partner, removing integration complexity

Why this is the critical phase: This is where you build the foundation for everything that follows. Without integration, you can't get to risk-based automation or AI.

Real example: Limehome, a fast-growing tech-enabled hospitality company, was expanding across Europe with a patchwork of local e-invoicing providers. Each new market meant new workarounds, bugs, and days lost to debugging. In Italy and Portugal, engineers spent up to 70% of their time some weeks just resolving invoicing issues. They had no centralized view of e-invoicing performance because each provider reported differently.

They consolidated onto a unified e-invoicing platform, starting with Italy (live in just 26 working days) and expanding to Portugal and beyond.

Result: They save 1,000 hours annually and achieve 99.9% invoice acceptance rates. New market launches that once took months now take two weeks. Expansion-related compliance work requires 70% less time. As their Engineering Manager put it: "We used to joke that our team should be renamed to 'Invoicing.' With Fonoa, we can finally focus on payments again."

Organizational moves:

• Establish global tax standards that local teams must follow
• Create a center of excellence that owns platform selection and governance
• Run change management that helps regional teams see consolidation as capability gain, not control loss
• Build audit trails automatically instead of recreating them during audit season

The unlock: Tax processes become predictable and scalable. New markets are no longer custom projects; they're configuration, not code.

Stage 3 → 4: From standardized to intelligent

Goal: Move from Established to Transforming by making tax operations proactive, risk-based, and continuously monitored.

Technology focus:

• Implement dynamic validation strategies (real-time in high-risk jurisdictions, scheduled elsewhere)
• Deploy dashboards that surface anomalies before they become compliance issues
• Automate exception handling with workflow triggers and alerts
• Connect compliance systems directly to billing and procurement for automatic return preparation
• Create a single source of truth for audit evidence

Why this transforms operations: You stop finding problems during filing and start catching them as they happen.

Organizational moves:

• Shift from reactive filing to proactive monitoring
• Empower tax teams to focus on investigation and advisory, not data gathering
• Build feedback loops where exceptions inform process improvements
• Create continuous audit readiness instead of pre-audit scrambles

The unlock: Compliance becomes predictable. Surprises disappear. Your tax team stops being reactive and starts actively managing risk.

Stage 4 → 5: The leap to AI-enabled operations

Goal: Move from Transforming to Leading by layering intelligence on top of integrated, high-quality data.

Technology focus:

• Achieve real-time data visibility across all tax operations (validation, determination, compliance, e-invoicing)
• Implement predictive analytics dashboards that surface patterns and trends before they become issues
• Build automated remediation workflows that trigger corrective actions based on defined rules
• Create continuous compliance monitoring with exception-based management (human intervention only when needed)
• Establish a unified data foundation where all tax data is normalized, timestamped, and audit-ready

The AI layer then becomes: Once you have this mature, integrated foundation with clean real-time data, you're positioned to layer AI on top for adaptive learning and predictive intelligence. But the foundation has to be rock-solid first.

Organizational moves:

• Tax becomes a strategic partner to product, finance, and growth teams
• Insights from AI inform business decisions (pricing, market entry, partnership terms)
• The function demonstrates clear ROI: faster growth, better cash flow, lower risk
• Tax professionals shift from compliance execution to strategic analysis

The unlock: Tax becomes a competitive advantage. You move faster than competitors, enter markets with confidence, and build trust with regulators through demonstrated control.

What "good" looks like: The happy path

When enterprises reach advanced maturity, the difference is unmistakable:

For suppliers and customers: Onboarding is instant. Tax IDs are validated in seconds. Invoices are accepted the first time, every time. Payments aren't delayed by compliance issues.

For finance teams: VAT returns are prepared automatically from transaction data. Audit evidence is available on demand. Quarterly close doesn't involve panic or overtime.

For tax teams: Time shifts from chasing errors to analyzing exposure, advising on strategy, and enabling growth. Exception handling becomes rare instead of constant.

For the business: New market entry accelerates from months to weeks. Product launches aren't delayed by tax complexity. Cash flow improves because revenue recognition isn't blocked by invalid data.

Real scenario from Apaleo: The API-first property management platform for hospitality needed to support clients expanding into markets with strict e-invoicing mandates. They evaluated 8 vendors and chose a global platform approach.

Now they support properties across 4 countries, processing nearly 5,000 invoices monthly. New market launches take as little as 3 weeks instead of months. They save 1,000 hours annually. Most importantly, they stay compliant as regulations constantly evolve (like Hungary updating specs every 3 months) because their platform partner monitors changes proactively.

As their Product Lead said: "Using Fonoa as our e-invoicing partner has been a huge benefit. We can focus on our core business, which is hospitality, not tax consultancy."

Instead of tax being a barrier to growth, the tax stack becomes an accelerator.

The investment question

"This sounds expensive" is the objection that stops many transformation efforts.

Here's the reality: staying immature is more expensive. The costs are just hidden in operational overhead, delayed revenue, audit risk, and missed opportunities.

Calculate what you're spending today on:

• Manual validation and correction of tax IDs
• Rework from VAT calculation errors
• Time spent preparing compliance reports
• Rejected invoices and delayed payments
• Audit cycles that consume weeks of team time
• Delayed market entry because tax infrastructure isn't ready

For most enterprises at Ad-Hoc or Developing stages, these hidden costs exceed the investment required to reach Established by 2-3x.

The real question isn't "can we afford to transform?" It's "can we afford not to?"

Your next move

Maturity isn't built overnight, but it is built systematically. The path forward depends on where you are today:

If you're Ad-Hoc: Start with tax ID validation and VAT determination. Get those right before adding complexity.

If you're Developing: Focus on integration and consolidation. Replace regional point solutions with unified platforms.

If you're Established: Layer on intelligence. Build dashboards, implement risk-based automation, and create continuous monitoring.

If you're Transforming: Prepare for AI. Ensure your data quality, integration, and platform foundation can support predictive and adaptive capabilities.

The enterprises that lead tomorrow are building their foundations today. Tax maturity isn't just about compliance—it's about resilience, agility, and competitive advantage.

Ready to see where you stand and what comes next? Take our 2-minute Tax Tech Maturity Assessment to get your personalized roadmap.