One of the most common questions I’m asked, often by recruiters, is if I know a prospective new tax partner for a smaller or mid-size practice.
Sadly I can rarely help directly – especially if, as is usually the case, the firm would like their new recruit to have a following (ie clients and fees).
In such cases I suggest that there are a number of key questions the existing partners need to consider and to effectively promote;
- What do you have to offer a partner with a following?
- What do you offer to a frustrated senior manager/director who isn’t being made a partner at his present firm?
- How can you be sure that someone who is prepared to move in the current environment is worth recruiting?
- How attractive is your offering (across the board) as compared with that offered by the myriad of other firms keen to recruit the same people?
You have probably already considered the economics of bringing in a new partner. And that’s why you hope that they will have a following so that they can pay for themselves. For a while anyway. So, why should they bring their clients to your firm? Be honest. And if you can’t convince yourselves you will simply waste an enormous amount of time seeking the holy grail.
There are other questions to consider too:
- How much tax advice work will you and your partners really allow the new partner to deal with? Will you all be able to ‘let go’?
- How much latent tax advisory work is there really in your existing client base? Is it that you’ve simply not been pro-active (perhaps due to a lack of tax technical knowledge) or would that not matter as your clients are largely risk averse and keen to keep their fees down?
- Is it a salesperson you need? This make your ‘search’ even tougher. You want a personable tax partner, with good technical skills and an ability to ‘sell’ ideas to clients – to generate good fees. Such people are few and far between.
- How wide does the new partner’s tax knowledge need to be? SME business tax? Private client tax? Trusts and IHT? SDLT? VAT? Everything? That’s a tall order too. Some firms find that the amount they spend on external tax specialists goes UP after they bring in their first tax partner. The simple reason is that he or she knows what they don’t know. And they tend not to want to take risks. And they know that quality specialist advice rarely comes cheap. The good news is that such additional fees tend to be covered by additional fees so they’re not usually a net cost to the firm.
So what to do?
My standard advice is to stop looking for the holy grail. Instead adapt your recruitment plan and find a very good senior manager who has the ability to become a tax partner but whose path is blocked in their present firm.
Another very underused solution is that of
arranging for an independent tax specialist to come into the office regularly to talk with partners and to review files for planning opportunities etc. This could be arranged on a weekly, fortnightly or monthly basis after an initial getting to know you session.
Best to think about how that initial session will work – do you want to make it a quasi interview (no charge) or are you going to do that over the phone and then expect constructive advice when he or she is on site?
The cost of this solution will always be far less than the alternative of bringing someone new in on a full time basis. We also tend to underestimate the time and time taken by briefing headhunters, interviewing and sorting out agreements etc.
In time such an independent could end up doing more and more work for you. They can even help with recruitment – especially as regards the tax technical side of interviewing tax staff at all levels.
For the record this was my considered advice long before I established the Tax Advice Network. But, yes, a number of our vetted tax adviser members are happy to provide tax advice clinics for local firms of accountants. One or two have even left us when they went full time in firms with whom they had built up strong relationships.