Peak Season Perils: Why November 2020 is so critical for accountants
Tax Season, Lockdown, The Second Wave … November 2020 might not look like the ideal month for accountancy practices but QXAS’ Global CEO, Dishant Desai says it’s the most critical month of the year to make the right decision to guarantee profits during this tax season. Shutterstock
There is nothing more unsettling than being in business and not being able to chart your next few months – while the world around you continues to move on. Many accountancy practices are going through something similar.
With the Second Wave, the second round of Lockdowns and an impending tax season – most accountancy firms find themselves caught in a domino effect where their progress has halted due to majority of their clients struggling this year.
What’s in November 2020?
As we edge closer to Tax season 2020 coming to a peak, for most firms – this is the month when they all the heavy lifting happens. From chasing clients for data to managing the workload of filing the returns in-house, November 2020 is when most firms get a sense of how profitable their tax season is turning out to be.
It’s also the month when most firms outsource their tax returns to speed up the profits or clear up the resource crunch they’re experiencing in-house. Since this tax season comes with more pressures and responsibilities than usual – November 2020 becomes a critical time for accountants to make a crucial decision for their firm.
How is this tax season different?
Tax Season has always been infamously associated with stress, mangled relationships with clients and a race against time. But this year, the added external factors of lockdown and pressures of running firms virtually, make this tax season rockier to navigate.
Some critical decisions that most accountants are faced with during peak season are:
1. Prioritizing Profits over Groundwork
While it’s easier now to slip into working longer hours for firm owners and decision-makers – long term success and distribution of workload in your firm is only guaranteed when you know how to prioritise better – for yourself & your staff members. But how do you prioritise better?
In a time when resourcing is getting trickier, prioritise high core-profit generating tasks like business development, client management and for your in-house staff members over the groundwork of the filing the returns. Upskilling your staff members in using the right tools –like CCH, IRIS etc. – to make communication and data collection easier is also a crucial move to strengthening your tax season.
This ensures the steady influx of new clients and more opportunities from existing ones and increases the capacity of your firm. Some firms also turn to offshore their non-core profit workload like tax preparation to better prioritise their firm’s profit-centres.
2. Shifting the Focus Back on Clients
Speaking of clients – a practice that isn’t taking into account its clients’ needs in the new normal is underperforming. If most of your clients are businesses, chances are they are in their recovery phase and looking for financial guidance to plan their next move.
According to statistics from the BACS payment scheme, 54% of small businesses are currently experiencing overdue payments. This the highest amount of cash flow crunch recorded since 2015.
From cheaper financing to ways of securing the most amount of tax allowances, small businesses are turning to their accountants for financing and. Most successful firms are using this time to solidify their position and “being there” for clients to navigate through this period.
“Freeing up your time to organise weekly meetings, educational webinars and assigning dedicated accountants to their projects – are various ways that you can showcase your availability and support for your clients, starting this November,” said Dishant Desai.
3. Revisiting Your Firm’s Resourcing
Distributing the tax season workload evenly is a herculean task.
With holidays approaching and accounting teams working entirely from home, firm owners feel the need to protect their staff from burnouts and reduce attrition among the team.
This also puts firm owners under a lot of pressure when saying “yes” to a low value, time-consuming tasks like tax preparation for clients. But is there always a need for a tradeoff between more profits and happy accounting teams?
“I often recommend firm owners to take a step back and look at their team structure,” says, Dishant Desai, Global CEO, QXAS. “Senior accountants in your team should entirely focus on managing clients and keeping up with their new normal needs, while you could divide the tax preparation workload between junior accountants and a trusted offshore team member.”
4. Making a Call on Your Tax Outsourcing Requirements
Outsourcing buys your firm the time and capacity you need to invite more clients and small businesses to work with you this tax season.
Delegating the groundwork of tax preparation to an offshore team members frees up the time for you and staff members to focus on upskilling, reducing overhead costs and taking on more clients during tax season.
In fact – some of your peers might be already gaining a competitive advantage by outsourcing this year. Last year, Accountancy Age research revealed that 64% of accountants were outsourcing to focus more on clients and manage their firm better.
How can an offshore team member help with preparing taxes?
- Staff fully trained in UK tax including tax legislation and with excellent technical knowledge and understanding of tax documentation
- 24-hour secure access to your jobs, so you stay in control whenever you choose
- Source documentation that means your documents never leave your office
- Tax returns prepared within 24-48 hours, helping you provide world-class service to clients
- Resourcing that is completely GDPR compliant
“It’s important that accounting firms outsource to gain a strategic advantage for your firm, not a last-minute fix,” said Desai, who consults accounting firms on the right outsourcing strategy.
“With the second UK-wide lockdown, businesses are looking for accountants everywhere for their tax season needs. November 2020 is the right time to outsource the workload you think is stressing out the resources at your firm so that you can be available for the last-minute clients during this time of the year.”
Are you making the right moves for your firm this November? Speak with a tax outsourcing expert today to explore new ways of making the most out of Tax Season 2020, without the headache of filing the returns.