Whether working for the October or January deadline, businesses large and small will be scrambling to file their returns on time. While many of them tend to leave this for the week or fortnight right before the deadline, getting an early start will help them complete their tax filing on time, accurately and without undue stress.
More importantly, your accounting firm must get a headstart in preparing for the tax season. Messy desks, disgruntled staff, stacks of paperwork (or numerous excel sheets) – do you remember your last tax season? Let us not be disorganised this year!
Here are six things to do before the self-assessment tax deadline starts looming:
1. Communicate regularly with clients
All too often, accounting firms have a hard time collecting and verifying the necessary documents from their clients and it becomes very stressful at the last minute. To avoid information coming to you in patches, you should:
- Ask for the right information over an email
- Ask for all the information in one go via a checklist
- Provide clear and structured instructions for clients to follow
Please make sure you start reminding them via email or phone call to have all the paperwork in place well ahead of time.
By doing so, you could also ask them to retrieve any data that might be incomplete or incorrect. And the better your relationship with your clients, the more accommodating they will be in case you do need something from them at the last minute.
Pro tip: Make a list of those clients who dilly-dallied in submitting their documentation last year. Schedule reminders on your calendar to contact them periodically. Picking up the slack for them puts extra pressure on your staff. Avoid that.
2. Revisit your processes
Tax filing will likely call for long hours and working weekends right before the deadline, but it is essential to ensure that your staff does not feel burnt out. This is an excellent time to identify areas that caused bottlenecks last year and need to be changed to serve your clients better and make work easier for your staff.
Having shorter, more efficient meetings will also improve productivity, as your team is freed up sooner to go back to work. Start implementing the changes now so that your staff doesn’t waste time adapting to them during the tax season.
Pro tip: Take a chill pill! Ensure you have a system in place that allows them to take some time off each week (for instance, half-days) so that they can be rejuvenated and perform better the next day. If your staff knows the schedule beforehand, they will be able to manage their work around it and meet deadlines efficiently. Also, clearing the trickier ones first should be the priority.
3. Generate more revenue streams
The closer tax season approaches, the less time any accounting business has for service expansion. Use the time you have now to offer new services in areas you have expertise in.
For example: while exact figures can only be obtained once you start the process of tax filing for your clients, it helps to have guesstimates of their investment horizon, personal goals, their assets and liabilities, cash flow and so on.
You could accordingly advise them on financial matters and help them plan future investments and save their taxes based on your analysis.
Start by offering the new service and investment options to your current clients first so that you can get referrals from them to share with prospective clients.
You can even offer package deals to your critical clients for your new and existing suite of services – this will boost their loyalty and bring in more revenue for you.
Pro tip: You should ideally conduct a market analysis to gauge the consumer demand gaps and the service you could potentially aim at providing.
4. Introduce a price escalation clause in your contract
Despite planning in advance, if you do end up stretching yourself for a particular client, make sure you charge for it monetarily. That is where such a clause comes in handy. In simple words, a price escalation clause is a contractual term that allows a price to be increased in case the prices for inputs increase. For instance, tighter the deadline, more the fees. It is necessary to get paid for the numbers of hours invested for a client.
Pro tip: Revise the contracts at the earliest and make sure you explain the clause to all your clients over a phone or Zoom call.
5. Spread the workload
Tax returns will typically eat into your staff’s regular workday, which could be more profitably spent on client-focused work, service expansion or business development. It thus makes sense to outsource your tax returns to a dedicated service provider with the expertise to do it quickly and efficiently.
Outsourcing guarantees that your taxes will be filed accurately and in full compliance with the latest mandates. Plus, for a reasonable fee, your staff will be freed up and can concentrate fully on the tasks they are best at such as client servicing and not have to be bothered to work longer hours or over the weekends – which every accountant dreads during the tax season.
Pro tip: Outsourcing can be a reasonably uncertain road if you have never walked on it. Therefore, undertake due diligence when choosing an outsourcing service provider for your accounting firm. Check out six checks to make when selecting an outsourcing company.
6. Upgrade your technology
For tax to be managed efficiently in the digital domain owing to MTD, it has become necessary for businesses to get tech-savvy.
There are several tax processing software options such as 1Tap, Receipt bank, IRIS, TaxCalc, Taxfiler etc. that are in sync with the latest tax norms so that you need not worry about whether or not your returns are fully compliant. Be sure to coach your staff on how to use the software and have a contingency plan in place in case it develops last-minute glitches.
Also, set up a documentation portal for your clients to upload the paperwork on the cloud hassle-free. That way, you and your staff don’t have to scramble around your emails to search for the paperwork.
Pro tip: Don’t wait for the tax season to begin to sort out your tech. Even if it is as trivial as purchasing new printers, do it now.
OVER TO YOU
It is in your hands to stop the tax season from getting overwhelming for you and your staff. Therefore, start preparing for it now. If you think you want to outsource, that is a smart choice too! We will be more than happy to help you. Simply click the button below and share your details with us so that we can contact you. Speak soon!