What Does an Accountant Do ?

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Making sure that an individual or business pays the right amount of tax can be quite complicated. No one wants to pay too much tax or too little, and there are normally different deductions and benefits that need to be taken into account.

Taxation legislation normally changes every year in some respects, and keeping up to date with the legal requirements can also be quite tricky. An accountant can be invaluable in helping people make sure that they pay the right amount of tax.

Why choose an accountant

Whilst employees of a company can sometimes fill in their own tax return online, there are also times when they would benefit from the services of an accountant as well. Many people work two jobs or switch jobs in the course of the year.

Some people have additional sources of income, from savings, investments or pensions. People who work part-time or receive some type of state benefit may also need help.

Accountants are normally associated with people who run a business.

There is no doubt that if someone is self-employed or does any type of freelance or contractual work, their tax returns will get more complicated over time, and they are likely to require professional help.

Most businesses of any size will have need of an accountant, even if they have in house accounting or financial staff.

Services of an accountant

An accountant can be crucial in making sure that the taxation affairs of any business, whatever its size, are correct, and conform to all state and federal requirements for the business.

As part of this, an accountant can help make sure the business is set up and structured in the most effective way possible.

This might involve the structure of the business, advising on whether to be a company, a partnership, a corporation, or whether or not to work as a sole trader or freelancer.

An accountant is quite often involved in giving advice and guidance in setting up software systems that cover bookkeeping and payroll, as well as different types of accounting software.

They may also get involved in profit and loss forecasting and advising on how much tax is paid in a particular year.

Choosing the right accountant

Many accountants specialise in different types of industry or business, and many specialise in different types of tax or taxation legislation. Recommendations from friends or business colleagues in a similar line of work can often be a good place to start when choosing an accountant.

Things to take into account include making sure they are members of professional bodies, such as The Chartered Accountants of Australia and New Zealand, or The Institute of Public Accountants.

A business should interview an accountant, in the same way that they would interview any consultant they looking to employ. They should check their credentials, their background and their experience. It is also good to know how wide their client base is in a particular area of work.

At a practical level, it is important to specify exactly what services the accountant is going to provide, and what their fees are going to be. Also, who is going to be dealing with their account, will they be accessible in person, will they be available by phone or e-mail and how often will they check in with you?

One final check should also be what type of complaints procedure they have.

A firm of accountants should have a fair and rigorous system in place to quickly resolve any complaints or problems that may arise during the course of the business.

This is a healthy attitude, recognising that problems do sometimes arise, and the important thing is to deal with them fairly and quickly.

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28 December 2020