Kundun Consulting

Time to push my own barrow and smack one of my pet hates.

Hands up anyone who thinks that all accountants know everything about tax.

Ok everyone please put your hands down!

I hate to burst your bubble but the simple fact is that not all accounting requires in depth knowledge of tax. Let me paint a picture.

I have been an accountant for around 18 years. I have however prepared very few tax returns. I can do it because I hate paying more tax than I have to - however for many years I had my own tax return prepared by a tax agent.

To highlight this further, law is an area where people specialise. If you need a family law expert there is no use going to a migration expert. The tax field is the same - it is simply just too broad to know every aspect. So should you be prepared to pay the exorbitant rates of any of the big 4 or second tier accounting firms then you will have access to GST experts, property tax experts, FBT experts - you get the picture.

So following the same logic:
Hand up those of you out there who believe that their tax accountant can help with anything relating to accounting - for your business.

Ok you 50% can put your hands down now.

Your tax accountant is by far the WORST possible person to help manage your business. No disrespect to them, but their knowledge about how practical businesses operate is limited to the end result of a period i.e. the end of year for tax purposes.. In many cases they have not even worked in a trading entity. How can they possibly advise you how to go about targeting a profitable line in your offering or determining pay-back on the purchase of an asset. Simple answer is they can’t.

If your business relies on this type of financial advice only then I must implore you to go out and find an accountant who can review your operations and provide strategic - not necessarily tax - advice.

It may just keep you operating through the turbulent times.

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Accounting, Tax, Small business