As an added benefit, reducing the role that income tax preparation plays in your firm can reduce the stressful long hours of the busy season, giving you back your evenings and weekends. (April is a beautiful month, if you can get outside to enjoy it.)
As an accounting professional, you have a wealth of expertise and experience that you can offer, and your firm’s service offerings should reflect these diverse skills.
Sales Tax Compliance
With e-commerce rapidly changing the definition of nexus, and states increasing their focus on sales tax collections, many firms are finding that sales tax compliance is a new growth area. With more than 10,000 sales tax jurisdictions across the U.S., even small businesses are becoming overwhelmed by trying to keep up with constantly changing rates, confusing taxability rules, varying reporting deadlines, and remitting collected taxes.
Furthermore, new automation tools are making it even easier for accounting firms to manage sales tax compliance for multiple clients, with systems like AvaTax ensuring that the correct sales tax rates are updated and applied, taxability rules are followed, and all sales tax returns are filed accurately and on time. Firms managing sales tax issues for their business clients also offer assurance in keeping the business compliant, can represent them in the event of a sales tax audit, and have the opportunity to consult with the client throughout the year on sales and taxability issues. These firms often achieve greater insight into their clients’ financials, since they are more frequently engaged with their sales activities. Enhanced firm visibility and value also helps strengthen the client-firm relationship.
Bundled Business Services
A sales tax engagement can be bundled into inclusive package pricing for clients. For instance, instead of billing separately for handling a client’s booking and payroll functions, the firm can include these together—monthly sales tax compliance, annual wage reporting and one business consulting and review engagement per year, for a recurring monthly fee. Some firms even bundle in a business client’s tax returns and planning. These engagements can help even out some of the bumps in your firm’s cashflow and workflow throughout the year, providing more stable revenue across more services, and strengthening client engagements.
Accountants and CPAs have a stereotype of being primarily income tax professionals. And while it’s great to be considered an expert, if that’s the only thing that your clients (or potential clients) think of when your firm comes to mind, you could be missing out on many areas where you could provide them with service. Unfortunately, the income tax focus is an impression that has been reinforced by many small and mid-sized accounting firms that over-specialize in those taxes. In fact, income tax compliance in some firms may account for well over 50 percent or 60 percent of total annual revenue crunched into two months of the year.