When the self assessment tax system was introduced, the SA abbreviation was intended to reflect simplified assessing, explains Mark Lee.
Despite many more recent tax changes few taxpayers believe that the system has become simpler. As such there remains plenty of demand for help when it comes to completing tax returns.
Recent HMRC campaigns to focus on specific sectors can only have increased the demand for accountants and tax advisers to provide support.
The question arises however as to whether the style of support that is on offer matches that which is required?
Existing clients
At this time of year most accountants with established practices focus their attention on their existing clients. The 31 October deadline is seen to be largely irrelevant to anyone who has the facility to file client tax returns online. We should remember though that clients with PAYE income will be better placed to have underpayments coded out if their tax returns are filed by 31 October. This also reduces the need to correct forecasts of the tax payable by 31 January or of incorrect statements of account.
At this time of year you might also choose to weed out any remaining duff d-list clients. That is, those who will otherwise cause you to work unsocial hours towards the end of January.
What about advising them of your new practice policy this year? To increase your fees as the January deadline approaches and to insist on payment upfront before you will prioritise their work in January? You are a professional of course and you are now introducing new procedures to ensure you are fair to all of the clients who value what you do for them. They appreciate that you do cannot do your best for them if you are required to turn things round at the last minute.
Accepting new clients
If you are well regarded you will get approached by or recommended to friends of existing clients, business contacts, family and friends. Do you have simple, standard processes in place that:
- evidence the quality of your work, your style and approach?
- enable you to weed out the sort of person you don’t want as a new client at this time of year (if ever)?
- ensure that prospects understand your billing policies for SA (and related) work?
- speed up the new client identity verification process to ensure compliance with your obligations under the anti-money-laundering regulations
- enable you to issue a letter of professional etiquette if you are taking over from another accountant, and then to pursue this if you need information before you can start work
Firms who do not receive a steady stream of new client referrals may struggle here. The easier you make it for yourself the more you will welcome such referrals and the more you will receive.
Beware too that if you file a paper return after 31 October the new £100 standard penalty will be charged even if all SA tax is paid on time.
Seeking new clients
Recently published statistics indicate that 1.5m individual taxpayers were hit with SA late filing and payment penalties earlier this year. This is 8% up on the previous year. As Rebecca explained here, next year’s penalties will be even higher. At its simplest the standard £100 late filing penalty will now apply even if there is no late paid tax. Previously the penalty was reduced to nil if all SA tax had been paid on time.
Thus, now is the time when growing practices could promote their ability to help people avoid the penalties and to keep their tax bills to a legal minimum.
I will address some of the options here in a follow up article for AccountingWEB.co.uk.
What do new clients want?
You need to know this before you can quote a fee that is fair to both you and to the client.
Do they just want you to help them fulfil their compliance obligation to file their latest tax return? They may simply want to know whether they need to file a return at all.
What about last year?
Will this be their first SA return? Do they have a UTR and/or a previous accountant? Why are they moving to you instead?
What about previous years? Have they failed to notify HMRC that they started a self-employed business activity some time ago? Has what was a hobby developed and started to produce regular income? What is to be done about previous years? How comfortable are you telling prospects that they have to come clean? Are your prepared to compromise your professional integrity and help them EVADE past liabilities?
Most clients want more than for you to simply put their figures onto a tax return and send this to HMRC. They want help and advice as to how they can reduce their tax bills. For the self-employed this means ensuring that they are claiming tax relief for all legitimate and justifiable deductions – something that few non-accountants can work out for themselves. A golden opportunity for the newly appointed accountant to evidence that they are pro-active. Do remember too to highlight how much tax your advice is going to save the client!
Mark Lee is consultant practice editor of AccountingWEB.co.uk and chairman of the Tax Advice Network of independent tax specialists. Visit his personal website and blog.
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I provide NED-style mentoring and business development support to sole practitioner accountants who want to overcome feelings of isolation, frustration and overwhelm - being the only decison maker in their practice.
I am also Chair of the Tax Advice Network - a highly ranked online resource for anyone seeking indepdent tax advisers....
Replies (50)
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Excellent Stuff
I shall print this out as one of my many check lists for new clients. Thank you for anticipating my needs!
Not really the right
place to post this as real Accountants do this as the norm.
New clients taken on in January
"........ as real Accountants do this as the norm" Couldn't agree more!
And who's going to disagree, eh?
I must admit I was doubtful that an article on this topic was required when the editors suggested it to me as something they wanted me to address. (The title is their choice too). So I am inclined to agree with the last two comments.
That said some would also argue that no articles on marketing and business development advice are required "........ as real Accountants do this as the norm". Except that many do not. If you are already perfect with no desire to improve or to become more successful don't read such articles. But please do not assume that everyone is as clever and efficient as you are.
It is clear just from @Moonbeam's comment that this article is useful at least for the less experienced members of AccountingWeb. Additionally the level of interest shown in just 24 hours (over 3,000 views) also suggests that the editors know what they're doing.
Of course given the view expressed by @johnjenkins and @coverack it would be a brave reader to support @Moonbeam's feedback......
Mark
ps: I've also written a follow-up piece that goes beyond the more obvious points addressed in the article above.
Office Junior Replies...
There are some hotshots on Aweb that will find this all rather trifling stuff I'm sure. When you're in my shoes, moving into lots more tax work from bookkeeping, it really is very different and extremely worrying.
Mark - your posts are very apposite for me, and since we have a lot of people just about to strike out on their own, I am sure they will find them helpful too.
I look forward to more of your thoughts.
@bookmarklee
Perhaps I should have explained myself more fully. Your article explains the basics. If an Accountant doesn't know the basics how can they advise a client? As this site is used by mainly professionals (q or uq) it really is a pointless exercise. As for 3000 views. The title is a good "lost leader".
With respect Moonbeam
If you don't have the basics (you need to find out why from your employers/trainers), then how could you possibly hope to start on your own and advise prospective clients? It's like a painter and decorator not knowing the difference between emulsion and gloss
Most of us are not "hot shots" but wouldn't have dreamed of advising clients until we were doing so already through our training.
I've always been against the arguement that the word Accountant should only be used by professionals but this article raises some doubts.
Ah yes, the incompetence!
I usually don't reply to accusations of incompetence, etc, because unless you know me and the way I run my business, as my clients and their accountants do, you can't possibly know. However on behalf of many other people who post valid questions and myself: you make assumptions that our experience is of a low level and then insinuate that you are on the moral high ground. The very fact that we are brave enough to expose our concerns about gaps here and there surely indicates some level of integrity.
I wonder if you realise how worried a lot of would-be posters are about exposing their short-comings publicly, suspecting that they are likely to be shot down in flames? When in doubt about the reaction, they just don't post anything at all. That's a tragedy, as there are so many helpful people on Aweb who do address the query concerned rather than perform a character assassination.
I am perfectly capable of advising small clients on tax, but lack the experience of estimating time in order to work out a fixed fee rate.
If you could please be kinder to others it would make your posts more interesting and if you don't feel like being kind - and we all feel that from time to time - then please refrain altogether.
I am going to be kind to you and suggest you haven't thought through how your comments come across and you would probably be very nice to me if I bumped into you at the local bus stop.
@moonbeam
We are not talking about selling a pot of paint here. We are talking about someones livelyhood.
If you are not confident in your own ability how can you advise a business on the way forward?
The article was basic knowledge not a golden opportunity. Perhaps it's the "starter for ten".
I will always address a genuine query with a genuine reply. Those queries though are not based on an Accountants basic knowledge they are an enquiry into how a certain problem should be approached.
No your quite right I do not know you or how your business is run but if you need any advice I will be only too pleased to help (that is a genuine offer).
As for incompetance :- your words, and with the risk of being too unkind I can only say "if the cap fits".
@johnjenkins
By the way - given the complaints I hear from real people, self employed and businessmen alike, I would disagree that all good accountants do everything addressed in the article.
Indeed I've shared elements of this piece in my talks to accountants over the last few years. The reaction is typically one of thanks for pointing out ideas that are only obvious with the benefit of hindsight. The final sentence of the article is a CLASSIC case in point,.
Mark
@bookmarklee
Proof of the pudding is always in the eating. How many Accountants that regularly subscribe to Awebb have made kind comments about your article? Ah yes moonbeam - you two aren't related are you? (Accountants banter).
Had another one via twitter actually
Both are unsolicited and unrelated. No idea who @moonbeam is.
And how many have agreed with you?
I've had enough articles published on here and contributed enough responses to blog and Any Answers for regular readers to know my style and approach. I remain pleased (and humbled) by how many such articles secure high viewing figures so quickly. Eventually accepted that there are plenty here who do like my style and approach.
Having said that I fully appreciate I will never please all the people all the time. If you don't like what I write, please don't trouble yourself to read it. Constructive feedback is however always welcome and ensures I strive to improve.
Any fool can criticise......
Mark
Had you read my
comments correctly you would have realised they were constructive. How can I not like what you write until I've read it?
Yes Mark any fool CAN critisise.
I look forward to not troubling myself to read your next attempt at A "golden opportunity" perhaps you could call it Mark's Marketing Makeover.
Penultimate word
As I'm sure @johnjenkins will want the last one....
None of the following strike me as constructive. Just critical:
"Not really the right place to post this as real Accountants do this as the norm"
"Your article explains the basics. If an Accountant doesn't know the basics how can they advise a client? As this site is used by mainly professionals (q or uq) it really is a pointless exercise."
"I've always been against the arguement that the word Accountant should only be used by professionals but this article raises some doubts."
"The article was basic knowledge not a golden opportunity. Perhaps it's the "starter for ten". [As noted above - it's not my title.]
"How many Accountants that regularly subscribe to Awebb have made kind comments about your article?"
Mark
Please don't take this the wrong
way, Mark, although you probably will. When you understand what I have been saying then you will have become an Accountant. If you would like to e-mail privately I can go into more detail.
I find when people take things I say the wrong way...
... I generally need to change the way that I communicate.
I presume you're
refering to your pre-penultimate word or was that just a communication change? However I am surprised that you feel the need to change the way you communicate. I don't think anyone could have taken youre article the wrong way.
Good luck for youre next offering.
wow....John have you taken this article the wrong way.....?
From my experience most 'accountants' have not had any real experience of running a business - they are employee's who sit with the comfort and knowledge that they will be paid a fixed amount each month whatever happens. This article (Mark you will correct me if I am wrong) is aimed at those accountants who are for whatever reason are self employed (some by choice and some not) - and whilst the article is basic there are many new starters who will appreciate advice that gets them to focus on these things.
You seem to have mistaken the professional accountant providing his technical knowledge and applying it to a particular financial scenario for a client.....with a self employed accountant developing his practice and wearing the many hats he must. This is not about providing accountancy advice - this article is to help those actually running their own business - which is very different!
Thank you @justsotax
Spot on.
Appreciated.
Mark
@johnjenkins
I must say that there are some arrogant, pig-headed members of AccountingWeb. If you can't take an article for what it is and seeing as you so clearly know everything there is to know about owning a practice then I feel that you don't need to be a member on here atall!
As mentioned previously these types of comments are extremely off putting for someone with a genuine worry or question. You have to start somewhere, usually at the bottom and with experience you work your way up.
The majority bite back...
Well said Hannah
Sorry haven't answered
earlier but was cycling from MK to Whipsnade Zoo (no I won't make any comments about seeing you there) along the garnd union canal. Clears the head after the weeks turmoils.
@justsotax. No I haven't taken the article the wrong way. Mark talks about existing Accountants and even talks about clients recommending business. My point is quite clear. An Accountant should not be advising business if they don't have the basic knowledge, which the article assumes. I agree that everyone has to start somewhere, after they know what they are doing. Quite honestly they shouldn't be calling themselves Accountants without proper training and knowledge. As stated previously we are talking about business livelyhoods. I consider being an Accountant a privilege not a "golden opportunity to show I am pro-active" and of course to let the client know just how much tax I have saved them.
@Hanna. Attitude, great, I like it. My daughter and grand daughter both have attitude but they normally come up with a bit more than arrogant, pig-headed, know-it -all and shouldn't be allowed to voice an opinion. I agree that you have to start somewhere, but that is where training comes in, and when you have the basics and know what you are doing then fine but if you have to read a marketing article to gain that knowledge then something is very wrong.
@Mark - The majority bite back - you certainly know how to grab the headlines. Accountancy is a profession of which I am very proud . It doesn't need "marketing gimmicks" especially aimed at people who think that reading an article will give them the right to advise business.
If you haven't taken the article in the wrong way
then I fail to see why you have a problem with it?...Unfortunately I am not aware of any firm or practice that offers the appropriate 'training' for an individual to start up their own practice, do the marketing/networking/billing etc and fit it between actually doing the job.
Like I have said previously you seemed to be mixing the skills and knowledge required to prepare accounts/tax and advise accordingly, and running your own business. You may well consider the article to be too basic - if so perhaps you could suggest some areas you feel would be more appropriate to expand on that may help accountants in practice?
Perhaps given your views it would be helpful to expand on how you atarted (20 yrs in employment before going S/E, promoted and then taken on as a partner etc), as I am sure not everyone is the same....
You have answered
your own question justsotax.
Accountancy is a profession that not only prepares figures it uses those figures to work out tax, provide advice etc. If you can't run your own business how can you hope to advise others in theirs?
Accountants in Practice should not need the "help" suggested in the article. If an Accountant in practice does need that "help" then they shouldn't be in practice on their own.
As previously posted we are not selling a pot of paint we are advising business.
I started as an articled clerk in 1965 with a firm of Accountants, did my training and have been self-employed ever since. Anybody can put a set of figures together, today you only have to data input and the computer does the rest. The training gives you an insight as to how businesses are run, what the pitfalls are etc. etc. and I'm sorry justsotax but you cannot get that by downloading an article that tells you what you should be doing.
To me the article is demeaning of the Accountancy profession.
@johnjenkins
I think the only thing 'demeaning of the accountancy profession' is the total disrespect you've shown not only the writer of the original article, but everyone else on the way through too.
If you know everything (and you have made that point several times) then I really don't think you need to be on this forum.
Bizarre......you got trained to become self employed...
...oh well you must have been the lucky one, not sure any practices do this now.
I don't doubt your level of skills or indeed the training you received but not everybody is as fortunate as you to get on the job training such that it will prepare them for self employment - most if not all don't get any such training - they learn by experience, i presume at some point you have learnt something from being self employed - or are you really saying you knew it all before you started.
I think you've got the wrong end of the stick.
I wasn't trained to become self-employed. I was trained to become an Accountant, however within that training (and I would presume most practices have the same sort of training) you learn how other businesses are run so really setting up on your own is no big deal if that is the way you wish to go. A couple of friends who I trained with went into industry. Becoming self-employed is not something to be taken lightly especially in the Accounting and taxation profession and you really do need to know what you are doing.
I haven't misunderstood....it is just you implied
you had learnt everything you needed to know about running business before you became self employed, I would just question that. Have you not learnt anything new about how to deal with clients, how to choose your clients carefully, charge up front where required, lose those clients who are wasting your time etc since you started?
I would actually agree...an element of good advice is having that experience in running a business to understand a clients perspective.....but by the same token some may suggest that if you have never run a greengrocers/butchers etc then how could you possibly give good advice other than doing the numbers, afterall not every business is the same.....are you an expert in all (or should I say have you had training in dealing with all?).
I didn't imply anything of the sort.
What I said was that my training as an Accountant taught me how businesses were run which then enabled me to choose what I wanted to do. I have never stopped learning and cannot see a time when I ever will. As someone posted in another thread most Accountants are "jack of all trades" master of none.
Dealing with clients comes natural to me and I would say comes natural to most Accountants. Again it all boils down to the training not marketing techniques or "golden opportunities".
Ignorance is Bliss
I pressed the Ignore button long ago and I am consequently a very happy bunny!
@Moonbeam
If you pressed the ignore button how come you're back? Perhaps another member of the Mark Lee appreciation society has appeared? Best you stay down your burrow.
@jaybee661 Where's your argument? Do you honestly think that Accountants that do not have the knowledge stated in the article should be advising clients or even in practice on their own?
@johnjenkins
So they do have the knowledge - so what?
How does that give you the right to shoot them down in flames? If you already know everything, why not move on to another topic instead of picking holes in the article?
Had you actually read my comments jaybee
you would realise that I am not picking holes in the article and if you had read more interesting articles you would also realise that I do move on to other topics.
So who is "they" who have the knowledge?
@johnjenkins
I'm not going to waste any more time on you - I would strongly suggest you read your posts again from the beginning if you think you're not picking holes - and you know full well that by "they" I meant accountants - dear oh dear...
I assume then
that you are not going to answer my question which relates to advising clients. That doesn't surprise me. So let me go over your post again.
So they (Accountants) do have the knowledge - so what?
How does that give you the right to shoot them down in flames?
What Accountants have I shot down in flames? I don't think I have shot any Accountants down. Let me go over my posts again no what I said quite clearly was that I don't think Accountants should be practicing or advising clients without having the knowledge suggested in the article so perhaps this was not the best place for it. Mark actually had his own doubts about the article so I don't think I was saying anything out of order.
@johnjenkins
... maybe the next article should be 'the basics of filing accounts with Companies House'...
...i think it should be on...
...'how to win friends and influence people'....
sorry couldn't resist.
Could you guys finish now??
I'm fed up of receiving email regarding this link so perhaps it's best to finish this thread now? John all I can say is that you really need to get some other 'hobbies' and spend time with your wife and family perhaps instead of on this website.
Regards.
@jaybee
glad to see you are following my posts. You might even learn something as I did.
@justsotax nice one, but didn't Dale Carnegie commit suicide?
@Hannna Surely you don't have to receive e-mails on this link. As for time with my wife. Had a fantastic weekend (as we do most weekends) Camping at Fakenham with a cycle ride into Wells by the sea. I suppose you had a wonderful time last night travelling around on your broomstick?
@johnjenkins
... you learnt something? To be honest I would have thought you would have known the facts about Companies House, especially if you're advising clients... being self-employed is not something to be taken lightly you know, especially in the accountancy industry...
well you learn something new everyday...
and having done a quick google it seems there is a question mark over exactly how he died depending upon which source you read....but I bow to you better knowledge (partly because it brought a smile to my face - nice way to end work today!).
Yes I did learn something
and I will continue to learn so that I can give my clients the best possible service. Does it affect my clients if I file accounts on -line or manually as long as they are on time - I don't think so. Does it affect clients of Accountants who have to read articles to get the basics - yes I think so.
@johnjenkins
... there is nothing more 'basic' than filing accounts online... if you think not knowing that has no effect... then go ahead and think it!
@jaybee
It's the contents of the accounts that is important not how they are filed.
@johnjenkins
... if you say so - the point is don't pretend you know everything when you CLEARLY don't...
@jaybee
your the one that's been saying I know everything just sorry to have let you down. If I didn't know better I would think that you are getting an inferiority complex.
@johnjenkins
... so you're saying you DON'T know everything then... good, now maybe you could apologise to the people that you've slagged off that don't know everything either...
@jaybee
It would appear that you have things [***] about face, which doesn't exactly surprise me. Do yourself a favour and go back over the posts, read them properly and then perhaps you may just realise how wrong your last post was.
I'm out tonight so you will have plenty of time to consider your next post.
@johnjenkins
... thanks for the offer but, having read your dross once, I'd rather not go over it again, if it's all the same to you... many thanks anyway though...
@jaybee
Ah shame. I was looking forward to a bit of banter this pm.