Tomorrow’s small tax practice is digitalby
Rebecca Benneyworth gives her views of the future of the small tax practice.
This is the first of a series of reports from the ICAEW Tax Faculty Wyman debate held on 12 July, where four visions of the future were presented by top thinkers in the tax world.
Rebecca Benneyworth sees the future small tax practice doing everything digitally; making use of existing software tools, such as bank feeds, to capture clients’ transactions into accounting software. She said this could spell the end of the January tax return rush. By processing clients’ accounting information more in real time, advisers can give a different type of support to clients and not be slaving over hot spreadsheets late into the winter nights.
Nichola Ross Martin, asking from the audience, queried the reliability of such software, saying that advisers can waste a lot of time setting-up and reconciling bank feeds. This can make it uneconomical to charge fixed fees for tax compliance work.
Benneyworth acknowledged that error-free software is essential for every tax practice. She cautioned against choosing the lowest common dominator of what is on offer, but also that tax advisers should not rely on free software provided by HMRC.
HMRC has stated its ambition to be the most digitally advanced tax authority in the world. Benneyworth said this as a great opportunity for tax advisers. She said: “We need to engage fully with the Making Tax Digital agenda, but we need to still oppose issues of detail where we consider that HMRC has taken a wrong turn.”
Benneyworth chairs HMRC’s Digital Advisory Group, which will enable HMRC to deliver that digital ambition, but that group will also have to highlight the areas where perhaps they have over-estimated taxpayers’ abilities. For example, just because the taxpayer has a mobile phone, it doesn’t mean he knows how to use a receipt capturing app. Tax advisers and accountants may find they need to provide technical support to certain clients to help with such issues.
Benneyworth’s key concern is: Can and will HMRC deliver to us (tax agents) the processes that allow us to provide digital tax services to clients? Benneyworth says we must remain engaged in the three-way conversation about this issue between: HMRC, tax agents and the software providers.
Benneyworth argued that there is a continuing need for sole practitioner tax practices such as hers. Clients deserve someone with the accountant’s skills and abilities. HMRC needs the accountant’s professionalism in dealing with small businesses, and the UK needs accountants to support small businesses to growth and to flourish.
What do you think? Are you digitising your practice for the future, or do you see problems ahead?