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Communicate with clients to make MTD work for youby
In the fourth instalment of our ‘Taking control of Making Tax Digital’ series in association with Dext, we’ll explore how you can guide your clients through the transition to build closer relationships.
The aim of this five article series is to give practitioners the confidence and skills to ensure that their practice and clients are ready for the opportunities and challenges that Making Tax Digital (MTD) presents.
As mentioned in our very first article in the series, communication is key for reassuring your clients.
There’s a lot of information, and misinformation, out there regarding Making Tax Digital for Income Tax Self Assessment (MTD ITSA), much of which is confusing or concerning even for seasoned practitioners. Your clients rely on their trusted advisors to guide them through the world of tax and compliance, so it’s essential that you take a leading role.
Any period of uncertainty can be a worry for clients, and if you don’t let them know you’re in control of the situation, there is a chance they may look for reassurance elsewhere. But proactive communication doesn’t have to be complicated or intimidating. The key is to apply your knowledge of clients’ needs and habits to ensure that you connect with and inform them in the right way to drive action, retain business and allay any natural fears that the idea of change brings.
That starts with focusing on value, then the details.
Focus on value
From your first indication that change will be required, through outlining timelines and executing your clients’ digital transition it’s important to keep value at the heart of your message. The ‘what’ of MTD ITSA is pragmatic and potentially uninspiring. However, the value that this change can bring to your clients and their business is huge.
This is where it pays to have a vision of where you want to be after the MTD ITSA transition, and how it’s going to help your customers. This becomes the core of your transition message and should be the basis of every discussion with your customers.
For example, more regular recording of information could help you give them a clearer understanding of their tax responsibilities in advance, while increased automation could reduce the risk of invoicing errors. By choosing tools in your tech stack that make a tangible difference to their lives, you can help make this value more immediate and compelling.
The tone of communication is also important. While MTD ITSA is an externally mandated shift, positioning it as something that you’re being forced to do against your will is unlikely to inspire positive action in your clients.
Creating a communication plan
Your communications with your clients regarding MTD ITSA should work in tandem with the developments in the rest of your firm. Education in this scenario should be progressive and iterative rather than all at once, partly to avoid bombarding your clients with information, but also to enable your team to learn as you go.
By building a strategic approach to informing and educating your customers you can ensure that they stay in the loop and are aligned with activity in your team, helping you work together.
1 - Segment your customer base
Every business is different, and that applies to business owners as well. Some of your clients may be already working in a way that complies with the new regulations, while others may need more help and support. This will affect the way you communicate with them, in terms of information, approach and medium. Split them into distinct groups based on their needs, using factors such as:
- When they will need to comply with MTD
- How they currently keep their financial records
- What kind of support they’ll need
- How comfortable they are with technology
- How they prefer you to communicate with them.
The more targeted your messaging, the easier it will be to inspire action.
2 - Phase your plan
Business owners are busy, and different clients will require differing amounts of time to onboard onto new systems and processes. Your different client segments can help guide your implementation timelines, devoting more time where it’s needed.
You may wish to handle all the ‘quick wins’ first of all - those clients who pose the least challenge - in order to spend more time with clients that need additional support.
All schedules should build backwards from the deadline for MTD ITSA with an awareness that:
- Clients take time to build new habits and change old ones
- New software will take time to learn, both for your team and your customers
- Clients will likely require multiple touchpoints to prioritise change.
3 - Optimise your medium for messages
You can mix and match mediums and approaches to increase the efficiency of your communication. For example, a general explainer video or virtual webinar to all your clients that covers the basics for MTD ITSA could be an engaging way to kick off your communications schedule, followed by more in-depth content according to the needs of your customers.
4 - Track and measure progress
The end goal of communicating with clients is to drive action to ensure they are working compliantly and understand their obligations under MTD ITSA. All stages of your communications plan should have clear goals for each segment that move them closer to compliance.
Just as with your internal process changes, it’s important to create visibility and accountability around this process to ensure your clients are moving forward. Ensure that you’ve mapped out key deadlines for informing clients of necessary actions, and also that your messages are driving actions, whether that’s in the form of meetings booked, software downloaded, training done or submitted returns.
Take control of your future
At Dext, we’re helping thousands of firms create future-ready processes that benefit clients, owners and the bottom line. No matter where you are on the journey towards compliance, time-saving technology, support and advice are always available from our expert team.
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I joined Dext as a Product Domain Expert in January 2021 having spent the previous 21 years in practice where I was a partner heading up the firm’s cloud accounting offering. ACCA qualified since 2003 I led the firms MTD and digital strategy, submitted the first-ever VAT return under MTD in the UK with QuickBooks, and provided support on...