“By early 2016 five million small businesses and ten million individuals will have access to their own digital tax account, and by the end of the next Parliament every individual and small business in the UK will have one. The digital accounts will be simple, secure, personalised to the taxpayer — and accessible through the digital device of their choice. As time goes on, they will offer more and more services.”
The key phrase here is ‘digital device’, showing that the Government recognises that business is now transacted on the move using smartphones and tablets. The digitisation of the tax system will transform how millions of businesses manage their tax affairs, and in turn, that will have a profound impact on the relationship they have with the accountancy firm that handles their tax returns. It's so important that 3,000 professional firms have attended our new webinars series in the last few weeks that explores this very issues - you can find out more about the Australian webinar series here
Over the next five years the need for an annual tax return will disappear. Personalised access to tax records will move online to offer secure access to digital tax accounts. The digital tax account will show PAYE taxpayers how much tax they will pay via their employer. Even those with complex tax affairs will be able to tell Her Majesty’s Revenue and Customs (HMRC) about additional income online and have it reflected in their digital tax account.
In Australia, the market is more progressive and The Australian Taxation Office (ATO) more aggressive than HMRC. As they seek to eliminate paper forms they also pose a digital risk to accountancy and bookkeeping firms. In the future there will be much less traditional compliance work and far more automation.
“It’s important to flag that the need for traditional bookkeeping services and simple tax compliance services will disappear,” says Peter Docherty, general manager of public practice at CPA Australia.
Significant and growing digital risk
Wherever in the world you are reading this, the story will be similar. Tax systems and ‘tax returns’ are being abolished or simplified, and add-on Apps make what were once difficult tasks (mileage tracking, receipt scanning, invoicing on the go, Real-time bank feeds, cloud-based data, automatic KPI reporting) remarkably simple.
The digital risk this poses to professional firms is huge – and perhaps more worrying is that most firms we speak to are unaware of what’s really going on. In our view, now is the time to respond, take action and at the very least take back control of clients.
As accountancy firms and bookkeepers give away Apps to their clients or allow the ATO or other providers to gain a ‘first mover’ advantage, who is really managing or owning the client relationship? Is it the software company or the professional firm? Whose branding does the client see each time they visit the App? Who has control of that customer in the App world?
Professional firms have given away control of their customer base!
Sadly, for many months now my team has watched firms around the world carelessly give away the ‘crown jewels’ of their firms: their customer relationship control and branding. Historically, they have guarded these ferociously, but have now abandoned them without understanding the risks.
They have simply handed over their client relationships to commercial organisations who then use them as a conduit, as an open door, to their valuable client base. Have you given yours away?
Not all of them!
But I’m delighted to say that many firms have already protected themselves and their client bases by launching their own App. These pioneering firms haven’t given away their client base to the HMRC, or another giant. Instead they have done what accountants should do! They have protected their clients and leveraged the technology to give their firm huge advantages over their competitors.
Simply, it means that every time their clients use a software system, receipt management, mileage tracker or calculator, it’s wrapped in their branding, reinforcing their name and developing a customer relationship that’s incredibly intimate.
For accountants, bookkeepers and financial firms, an App created by My Firms App specifically for their business offers ten formidable advantages:
- It is the only App that has passed financial compliance checks.
- It is endorsed and recommended by financial institutions.
- It creates closer working relationships with clients.
- It develops mobile services tailored to specific business partners.
- It uses powerful services that use the native features of the smartphone or tablet.
- It is a new ‘always on’ communications channel.
- It differentiates you from your competitors.
- It supports the new digital tax returns today via powerful App features.
- It places the accountancy practice’s expertise at their clients’ fingertips.
- It enables you to join the App economy and become a technology leader.
As the Government moves towards paperless accounting and tax management, this is the perfect time for all accountancy practices to connect to their clients with an App.
The App economy is firmly established. As digital tax returns and the wider tax affairs of businesses and individuals become more digitised, only those accountancy practices that have created an App to connect these new services to their clients will thrive in an increasingly competitive marketplace.
You can test drive the globally approved App for professional firms here.
Or watch the popular video below - Why launch your own App?