Posted 24/04/2015 by Will Farnell
Well, it’s over a month since the chancellor delivered his budget. As we draw near to an election, and possible change of government, the debate on the likely demise of the tax return rumbles on.
At Farnell Clarke, we’ve been banging on about the fact that compliance is dead for several years. That’s because the fantastic software that’s now available allows more and more people do their own accounts and have way more control over their financial management.
Some traditional accountancy firms may consider this a threat but we’re not worried. That’s because, in our view, the key for accountants and advisors is to adapt their offering to ensure they’re offering value where clients really need it.
From day one, we’ve used technology to drive down compliance costs. And since adopting cloud accounting we’ve seen just what a massive difference a smart approach to necessary accountancy tasks can make to businesses of all sizes. Reducing the time, and money, we spend on routine tasks allows us to focus on higher value work. This move to dispose of the annual tax return by HMRC has the potential to be the death of the traditional annual accounting model which so many firms have relied on for hundreds of years. But clients certainly don’t care about the minutiae of annual compliance obligations so why do so many accountants focus on it?
A new approach to tax is likely to mean that clients will need to keep their records updated throughout the year to ensure they pay the right amount of tax. As a result, firms will need to adapt their systems to make it easy for clients to manage their tax obligations. If we want to continue to be of value to the people who currently rely on us to complete their tax return then we have to adapt and offer something new.
I hate to say “I told you so”, but in a presentation at last year’s Iris World I predicted that our market would be unrecognisable in five years’ time. Mr Osborne seems to agree with me and I wonder if the next chancellor will too.Back to Blog