Three top tips for getting ahead of the game and avoiding the end of tax year rushby
Every accounting firm in the UK works to the rhythms of the country’s tax obligations and the end of the tax year can often be particularly stressful.
With around half of the current tax year left to play out, this is a great time to start thinking about how to approach the end of the tax year when it rolls around again – so here are three top tips to help you get ahead of the game and avoid the end of tax year rush in 2020.
1. Communicate with clients regularly
Regular communication with clients helps practices to stay on top of their accounts throughout the year and solve any problems as they arise. Consequently, filing year-end accounts is quick, simple and there are no last-minute surprises from clients!
“When our clients start with us and begin using FreeAgent, we talk to them about what lies ahead,” said Jessica Pillow, managing director of Pillow May Accountants. “Opening communications with clients from the outset is crucial, but continuing that communication regularly is just as important. Every subsequent year we continue to talk to our clients – we ask them about their frustrations and we talk to them about any new FreeAgent features they may be able to benefit from.”
Pillow also mentioned the importance of keeping the communication flowing with FreeAgent. Chatting regularly with software providers can be really helpful as they can make practices aware of any new features recently added to their platform or upcoming features that will help clients overcome specific issues. This then provides accountants with a starting point for conversations with their clients.
Pillow concluded “all this helps enormously when it comes to the year-end, and invariably, when it comes to that time, clients are where they need to be – meaning we can get their accounts filed easily and ahead of time.”
Michaela Rees, the founder of Sterling Rees Tax & Accountancy, agreed that FreeAgent makes communicating with clients much simpler.
“We have client dashboards we can monitor. We can log and set up alerts. We can see when something has happened – or sometimes when it hasn’t but should have. As a tool it allows us to be proactive.”
Three months before the year-end, the firm’s accountants look at client figures in detail and start to talk to the client about any possible benefits they could see from planning and being proactive. “It’s a game-changer taking this approach – and it is helped by having FreeAgent advisers on side to support the questions we have when things crop up – so we know we are always giving best advice to the client.”
2. Search less, do more
Cloud accounting has transformed the experience of meeting the year-end deadline. It is still important for clients to provide their accountants with required information as soon as they can, but the ease associated with features like snapping receipts on the go and automated bank feeds means there’s very little that clients need to do manually. The remaining manual tasks are also much quicker, and accountants are able to rely more on the accuracy of information provided.
Sarah Solo at PaperRocket Accounting explained, “When it comes to hitting the end of the tax year, we know our clients need to be timely in their actions. There’s still a certain amount of chasing and reminding, but – for the most part – gone are the days where you have to decipher things and shuffle paper. Everything is there in one place, and it’s in good shape already – we can do so much within FreeAgent. That’s just the way we like it.”
3. Make use of real-time insights to enhance efficiency
Peter Edwards of Warr & Co Chartered Accountants notes that his firm uses FreeAgent to create a trial balance, making the rest relatively easy. “It is simple to change account codes in FreeAgent, for example, and we love the functionality across the board.”
So is accounting software improving efficiency? “Of course,” said Edwards. “It is more efficient all around. It means we can do our work sooner and more confidently, and with substantially less reliance on the client.”
Edwards said other insights from FreeAgent across the tax year also help sidestep problems at year-end. “Knowing about late-paying customers, for example, and the degree of their tardiness, is useful to our clients. They know who to chase and when, and their accounts stay in better shape as a result.”
Profit and loss is a useful view in this respect, added Edwards. “If a company is making a decision on a van purchase, say, then insight from the visuals and other views that FreeAgent generates can help with a decision on timing – that is, when to make a purchase and the tax implications that follow. It would apply to buying any asset, but it means a firm goes into any big decisions with eyes open, and delivers a year-end benefit.”
Find out more about avoiding the end of tax year rush and other compliance issues in our new guide - 5 compliance conversations accountants can master.