Business owners and all taxpayers, that’s most of us, are required to comply with the numerous regulations set out in the UK tax code and companies acts’ legislation.
There is no choice in this process. If your circumstances fit the brief – you are self-employed, pay tax, have a company – there is no wriggle-room, you have to file information and pay tax by a certain date, or else…
This compliance burden is why the professional accountancy profession has flourished, to meet these demands on behalf of clients so they are free to get on with the job of running their businesses and their lives without the constant anxiety that this or that regulatory obligation has been met.
Unfortunately, many tax-payers are increasingly drawn to see this need to outsource as a “grudge” purchase. And so, tax advisors need to be aware of this, and reposition themselves accordingly.
In part, this explains why increasing numbers of less qualified individuals are being drawn into this conundrum – offering compliance service at a lower price and encroaching on the services provided by professional firms, but at a much reduced price.
This process is a self-generating drain of pure compliance work away from the established “professionals” to less qualified advisors and it does raise the issue that buying compliance based on price rather than competency may not be a taxpayer’s best option.
As artificial intelligence gradually erodes much of the drudgery of pen-pushing by innovating smarter and more efficient accounting software, the accountancy profession will need to be wary that their new competitors – bookkeepers etc – will be joined by software providers that offer to join the circle of compliance by easing the process of data entry and automating all the compliance chores, including the filing of year end accounts and tax returns.
Savvy professionals are already starting to distance themselves from this grudge compliance issue by adding value to the services they offer. This is a process that is likely to continue. In the future, it may be the advisors that are able to think outside the box that will survive and flourish. The future for those who don’t will be bleak.