Handling taxes is perhaps one of the most difficult aspects of business ownership. Out of everything that involves business accounting, taxes are not only the most difficult part but they’re also the most complex. And it’s costly to your business if you make errors. Thus, many business owners work with a tax consultant.
A tax consultant can help you prepare and file taxes. And they can offer you financial advice and represent you during an audit. However, how do you find the right tax consultant who meets your business needs?
Choosing the right tax consultant is the most important decision a business owner can make. The right person can save you loads of money and they help your business scale. In contrast, a bad tax consultant can cost you huge chunks of money.
But with thousands to choose from, it’s a daunting decision to make. So, to choose and work with the right tax consultant, there are some questions you can ask to help you make the right decision.
Why Should I Hire You?
Hiring a tax advisor is more important than taking on a staff member. If you hire the wrong one you can miss out on huge opportunities, which is costly.
So, the key thing during the hiring process is to consider how a tax consultant will add financial value to your company. Therefore, look for someone who can make a perfect business partner. Ask them to prove their knowledge and skills in supporting your business.
Take your time during the hiring process. Interview at least five candidates before making the final decision.
During these interviews, ask key questions such as what their qualifications are and whether they’re a member of any professional body. For instance, an ICAEW member will have professional indemnity insurance, which means they’ll cover any losses to your business because of bad advice.
Also, consult others in your industry to get second opinions about a tax consultant’s reputation. Plus, ask the tax consultant to share testimonials from customers, or you can ask to meet their current client.
Asking the right questions can help you find the right tax advisor who meets your business needs.
Can You Make Me More Money?
Most people assume that the job of a tax consultant is to just look at annual reports, prepare and file taxes, and maintain tax compliance. However, this is only a small portion of what a good tax consultant can, and should, do for you.
A good tax expert can help you raise capital by finding government funding, tax relief schemes, and grants. They can help you sell more shares in the business, or find lucrative investments.
Instead of asking, “Can you balance my books?”, ask, “What is it that I am entitled to that I don’t know about?”
To find the right tax advisor, you need to weigh the money they can make you against the cost of hiring them.
During the hiring process, ask your candidates, “Why should I pay you to do this?” How they answer this question will help you choose the right candidate.
Also, talk money upfront, or you’ll be shocked once you’ve committed.
Are We a Great Match?
The perfect tax consultant is more than just prestige. They must be able to understand your business needs and they should offer relevant insights.
As a business owner, it’s common to be naïve about your business requirements. To avoid this pitfall, ask a tax consultant if they have worked with a similar business before, or if they have the expertise in your industry. This will make sure they understand your challenges, and their price is more likely to suit you.
During the hiring process, ask them for other companies they have advised in your industry. Also, ask if they have advised companies at the same life-stage as you. What other services could they imagine offering over time?
These questions will help you assess their breadth of expertise and their ability to think about your business’s evolving needs.
Because tax experts offer different levels of engagement, establish how often you’ll be in contact, and if you’ll communicate via email or phone call. While less contact means less costs, it also makes it hard to ask questions and spot problems.
Also, remember that if you opt to deal with a large tax consultant firm, the person you meet or speak to on phone might not be the one handling your work. Thus, ask who will handle your account daily. This will make sure you’re not palmed off to the office intern. And, it’ll guarantee the person in charge of your account understands your business needs.
After finding the right consultant who understands your business needs, measuring their performance should be an ongoing process. Hold monthly meetings to get their opinion on your business and its finances. And if their view is close to yours, this is an indicator you have the right person on board. However, if you only hear what you expect, that’s not good. Because you want to see some challenges or initiatives, right?
Remember, assessing performance isn’t about whether your tax consultant asks the right questions. Instead, a good consultant should check up on you once in a while to see if there any issues, questions, or concerns to discuss. If they don’t do this, then they aren’t adding much value to your business.