At the Thomson Reuters Direct Tax Live event, the term API came up more often than AI - and yet many senior tax leaders present weren’t entirely sure what one actually does, beyond allowing information to pass between systems.
That observation resonated, because it reflects something we encounter regularly at the start of tax technology projects. Plenty of interest, but not much background knowledge. This article aims to change that - though it is an introduction, not a deep technical dive.
Where can you find APIs?
You are probably using APIs multiple times a day without realising it. Consider ordering an Uber. The maps you see while tracking your driver are not Uber’s own - Uber accesses Google Maps via an API.
APIs are everywhere, quietly powering the technologies we rely on. They are particularly useful when connecting to third-party systems.
What exactly is an API?
API stands for Application Programming Interface - a set of rules that allows one software application to interact with another.
Think of it like a waiter in a restaurant. You (the client) place an order with the waiter (the API). The waiter takes that order to the kitchen (the server), and returns with your food (the response). You never need to go into the kitchen - the API handles the communication between you and the system without you needing to know how it works internally.
APIs in everyday life
Every time you request an Uber ride, the app simultaneously calls multiple APIs:
- Google Maps API - to show where your driver is
- Payment API - to handle your payment securely
- Notification API - to send updates on your driver’s status
None of these systems are built by Uber. The company simply connects to them via their APIs to deliver a seamless experience.
APIs in tax: an ONESOURCE example
Here is a practical example: transferring tax disclosures from ONESOURCE Corporate Tax to ONESOURCE Statutory Reporting via API.
The process works like this:
- Request access to ONESOURCE using your username and password
- If granted, receive an access key - known as a Bearer Token
- Request the tax disclosure data from ONESOURCE Corporate Tax
- Receive a response containing the data
- Decode and repackage the data
- Submit it to ONESOURCE Statutory Reporting via another API request
- Receive confirmation that the transfer succeeded
The API automates every step. What would take hours of manual data preparation and re-keying now takes minutes or seconds - reliably, every time.
The response data arrives in a format called JSON - a structured text format that tools like Alteryx can read and process automatically. A full tax computation can return hundreds of pages of data in this format, all delivered programmatically without any manual extraction.
How can you use APIs in tax technology?
APIs do not require you to be a developer. They can be used through:
- Excel - embedded for teams that prefer to stay in a familiar spreadsheet environment (though this approach has practical limits - more on this in Beyond Excel: Using APIs to Enhance Compliance and Reporting)
- Robotic Process Automation (RPA) - triggered automatically as part of a broader workflow
- Alteryx - our preferred tool, which allows you to build an entire tax automation process in a single visual workflow, without writing code
If you want to see an Alteryx API workflow in action, we have published a demonstration on YouTube showing a full OCT-to-OSR data transfer.
Key benefits for tax professionals
Speed - complex, time-consuming processes complete in minutes.
Accuracy - automated data transfer eliminates the transcription errors that remain one of the most common sources of mistakes in financial reporting.
Scalability - handle large datasets across many entities without proportional increases in manual effort.
Efficiency - free your team to focus on analysis and judgement rather than data preparation.
Getting started
Most modern tax platforms already have documented APIs. Understanding what connections are possible in your current environment is the first step - and the gains from even a single well-designed API integration can be significant.
Get in touch if you would like to discuss what API connections might be achievable for your organisation.
