Ding Ding! 🥊
.... Who will finish on top!? 👀
Tax Advice
Definition
At Diagnostax, we define Tax Advice as “specific work or planning to improve your client’s tax position to make a tax saving or get cash back into your client’s business.”
When to use:
This is an add-on service that you can charge your clients for and it should be used in relation to your clients business and personal goals.
And as you know, tax is complex.
But unfortunately many clients don’t understand the value of Tax Advice. Nor do they realise that having ALL the tax knowledge is basically impossible when you are an accountant and/or advisor, who doesn’t specialise in tax. So even though they are asking you ‘a quick question’ providing the right answer is a lot harder than it seems.
But here’s what we recommend…
Depending on your experience, your time, and the complexity of the tax question, this will impact the route in which you take in providing Tax Advice to your client. If you want to find out more on where to start with your clients’ tax questions, check out this blog post.
Keed in mind, some of your clients expect you to include Tax Advice services as part of the fees they already pay you. But this is where your clients don’t fully understand the benefits, time, and cost of obtaining formal Tax Advice.
To find out more, you should check out our blog post, The Truth About Tax Advice.
Here we go into more detail about how you can effectively demonstrate the value of Tax Advice to your clients.
Tax Consultancy
Definition
This is a stand-alone service, which you will more than likely provide free of charge to your clients, involving reviewing your client’s overall affairs such as motives, goals, and their current situation; enabling you to highlight to them as to where they could benefit from Tax Advice for current or future savings, to meet their goals.
When to use:
If your client is unsure what to do when it comes to receiving Tax Advice or the area of tax (in which the Tax Advice is relating to) is too complex, then Tax Consultancy is needed. This is to ensure your client is properly informed so that they can decide on which route they should take; through understanding the specifics against their exact scenario and provide certainty, enabling them to make an informed decision.
To determine if Tax Consultancy is needed, consider:
Have you done this with the client already? Or have they already obtained advice from another specialist such as a lawyer?
Is the client aware of all their options?
Has the client already decided what they want to do?
Tax Advice Vs Tax Consultancy Cheat Sheet
Tax Consultancy Goal: Information gathering
Conversation led
Discovery of what is needed
Stand-alone service that you usually provide free to clients,
Client goals focused
Tax Advice
Goal: Achieve results
Action led
Options & recommendations provided off discovery
Add-on service that you can charge clients extra for
Client savings focused
The truth is, there is no champion
Tax Advice isn’t more important than Tax Consultancy. And Tax Consultancy isn’t more important than Tax Advice.
They’re actually complimentary to one another.
You can’t obtain Tax Advice without first undergoing Tax Consultancy; as Tax Consultancy shapes what Tax Advice is needed for your client to achieve their goals.
And it would kinda be pointless only doing Tax Consultancy; why waste your time and effort in understanding what you can do for your client, to then not take that further and achieve the results for your client through obtaining Tax Advice?
The power card is you knowing what your clients want. You’re the real champion.