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Services of a tax accountant

Tax accountants are primarily hired for lodging timely online tax returns, compliance with taxation revenue authorities, communication and coordination with taxation…

By Eve Sticht , in Financial Services , at August 1, 2019

Tax accountants are primarily hired for lodging timely online tax returns, compliance with taxation revenue authorities, communication and coordination with taxation authorities. However, one thing which one should have to know here is that there magical and lucrative services are lot more than that. For example, they reconcile accounting balances with tax bases, they maintain records and documents which can be presented before taxation authorities, assist in financial reporting system for making tax entries etc. All these said duties and responsibilities are of operational nature. Attention should be dispensed here that tax consultants also proffer advisory services which can impact decision making of an entity. Let’s say, a small scale or startup is envisaging to invest in a venture. Do you think management of an entity would be interested to know tax consequences of this acquisition? Sometimes, it has been seen that many decisions are changed merely because of adverse tax consequence. Every decision which affects profitability of a company/business is surely relevant. So, everyone knows that tax expense would always hinder profitability or liquidity of a business and for better management of liquidity, you always need a professional tax consultant. It would not be wrong to argue that strategic decisions are always highly depended upon tax consequences which might arise after culmination of any transaction.  Further, importance of tax accountant services can also be pondered if one evaluates following factors: 

Tax planning 

How much to invest, where to invest, how much a company/business should hold in form of cash or deposit in a bank account, what would be the impact of excessive borrowing rates on a tax expense. All these questions are very common which every business usually face during every stage of a life cycle. These decisions are linked with company’s tax planning policy. In absence of detailed plan, it might be possible that businesses/firms would have to endure massive losses. So, what to do? Always engage an experienced tax expert so that a detailed and professional approach can be made before starting of every financial year. Business analysis shows that those companies who remain engage in timely planning, usually own a competitive edge over other businesses. Please click here for small business accountant in Melbourne.

Advice on tax avoidance 

Usually people do not understand the literal meaning of tax avoidance. They sometimes affiliate this aspect with tax fraud or tax evasion. Basically, tax avoidance is a mechanism in which company/firm circumvents high dues of tax by indulging in legal activities. For example, if a confronted entity engages a qualified tax accountant who can present on behalf of its client before revenue authorities, it is a core example of tax avoidance. On other hand, altering the nature of a transaction without making any misstatement or concealment is also tax avoidance. However, all these complex aspects can never be managed by an amateur. For this purpose, you need a qualified, competent and experienced tax accountant in Melbourne cbd who can handle any kind of tax dilemma as easy as pie. Moreover, sometimes revenue authorities falsely issue a notice of penalty or fine which can be revoked but again, not possible in absence of an adroit tax consultant.   

Why outsourcing 

As far as taxation matters are concerned, no one can deny that these matters are very complex not only on interpretation of law but also due to strenuous routine procedural steps. These procedural aspects include a) how to file an application b) to whom communication should be made c) what procedure should be followed to present before legal authorities etc. For management of all these cardinal things, structuring an internal department not only consume heavy cost and material time but also your business might face other dilemmas on account of lack of expertise. So, outsourcing of taxation matters to a qualified tax accountant is a notable option which has several beatific elements. 

Therefore, conclusion can be drawn that for any kind of business/entity, regardless of its size and nature of operations, essence and importance of a tax consultant can never be overlooked. For further ease and comfort, in these days almost every tax and accountancy firm can be engaged using online medium which further saves an ample effort and time of a business. However, one thing which should be taken in account is that only go before professional and proficient tax accountants in order to avoid any destructive culmination.