Chatting with an accountant recently he told me he was amazed why so many clients leave their tax returns to the last minute. He told me he chases clients throughout the year. He sends reminders and prompts. He has recently asked around his business networks to clarify why small business owners and investors do this. It became clear that there are typically 3 reasons:
- They find the collation of their papers boring
- They have more important things to do
- It’s not a priority until the filing deadline is looming
My friend was frustrated by these replies but also satisfied. It’s not just his clients and it’s nothing to do with him. All accountants struggle to cope with the January tax return rush but at least now he knows why.
There is only one reason for the January tax return rush and, I’m sorry to say but it is entirely the accountant’s own fault. I’ve been saying this in talks for years and offering solutions on how to overcome the issue.
Quite simply your clients leave things to the last minute because you let them do so. Yes you do. And, yes, YOU could change things. There are three main ways to do this:
- Reference an earlier deadline and stop drawing your clients’ attention to the 31 January filing deadline. YOUR deadline is (say) 31 October. Treat it seriously and be as forceful around YOUR deadline as you have previously been re HMRC’s deadline.
- Establish a stepped fee structure whereby clients have to pay higher fees the later they produce the information to enable you to complete their tax returns. And stick to it.
What do you think the third option is?