DID YOU GET BLOWN AWAY BY BUDGETS? RICHARD CURTIS THINKS THEY SHOULD BE A BREEZE
Or should that headline be ‘Blast! It’s the Budget!’ Or this year, ‘Blast! It’s another Budget’. And just to pile on the misery this year, ‘Blast! It’s another Finance Bill.’ Remember that we’re going to have three of those in 2010.
Two Budgets and three Finance Bills: that’s got to be a first hasn’t it? Unless, dear reader, you know different. So is this a quintuple helping of misery as far as you and your tax practice is concerned or might it be a multiple helping of opportunities?
It’s very easy when in practice just to take the line of ‘what will be, will be’. You might keep an ear open to the radio while the Budget speech is on as you’re trying to figure out whether the Bloggs family and their four companies are entitled to small companies’ marginal rate relief.
You may also purchase the paper the next day and have a quick look through to check the major changes; but hey, it’s just the Budget – and who knows what will have happened by the time the proposals have worked their way through the Finance Bill and committee stages and finally become law in the Finance Act.
Perhaps it’s best not to worry about it – remember, ‘what will be, will be’ – everything will come out in the wash; now where were we with the Bloggs’ corporation tax calculations?
Best practice?
This approach is fine (although that may not be the best word to use) if all your practice is doing is providing an historical exercise in the preparation of accounts and tax returns, but you may start to find that your potential pool of clients is increasingly limited.
What we do
LexisNexis is, of course, in the business of providing information and Budget days tend to be busy times. Our team of tax writers analyse the Budget speech and the press releases from HM Treasury and HMRC to provide a succinct Budget Summary. Subscribers to Taxation magazine can download a copy from the Taxation website.
These are produced and printed overnight so that they are ready for our readers the next day. They can also be personalised with a firm’s name and details should they wish to provide something similar for clients and some firms use such publications as the basis for the ‘breakfast meeting’ on the morning following Budget day.
Such events or seminars within a day or two of the Budget, or even the sending out of a Budget newsletter are all ways of keeping your clients informed and providing a service that steals a march on your competitors.
Budgets are good
Louise Manning runs her own business, Cox Manning, in the market town of Petersfield in Hampshire. She and her team act mainly for small to medium-sized businesses and high net worth individuals. Louise firmly believes that ‘Budgets are good for business’ and that they do provide an opportunity for sole practitioners and smaller firms if they are prepared to invest some time and energy.
‘Different accountancy firms look at the Chancellor’s Budgets in different ways. Some ignore them on the basis that all their clients will be bombarded with information from every branch of the media, while others try to give a truly personal précis. A précis that means they spend hours poring over the HMRC press releases, and financial press synopses, before issuing a newsletter several days after the hype has died down. We do neither. Instead we buy in a “personalised” package that enables details to be downloaded from our website by start of business the following day and we also take delivery of printed summaries for the (still quite numerous) clients who have yet to discover the delights of the internet.
‘All very normal and unlikely to set the world on fire, but where we really steal a march on our competitors is by offering free evening seminars. Anyone who is happy to give up their time to learn something useful, while consuming our food and drink and networking with potential suppliers and customers, is welcome.
'So, this year has been a bumper year. We started with “Things to do before the Budget”, followed that with evenings on “What the Budget means for you”, then “Pre-election tax planning” and finished with “How the emergency Budget affects you”.
‘Each time we attract new and potential clients while simultaneously keeping the existing client base happy. We have the opportunity to ensure that our marketing material is easily accessible and can chat to our competitors’ clients in an informal and relaxed atmosphere. Undoubtedly some of the regulars only come for the buffet – but they serve another purpose as well.
'They are more than happy to tell anyone who will listen that we are proactive and approachable so they, along with this year’s two Budgets to date, are responsible for increasing our client base. Hopefully, George Osborne will be boosting our marketing still further with a Pre-Budget Report in the autumn.'
The big firm
Francesca Lagerberg, head of tax at Grant Thornton provided a perspective on the provision of information to clients from a large firm.
‘With two Budgets this year plus a Pre-Budget Review and a Comprehensive Spending Review all within 12 months, for many clients it can feel like Groundhog Day, with tax changes coming along in a seemingly never-ending cycle.
‘The big win for tax advisers is about cutting through the detail and explaining what it means in practice. What are the opportunities? What are the pitfalls? And sometimes – in the face of media hysteria – what are the “don’t panic” items?
‘With much pre-announced or at least predictable, it’s also about giving clients options. For example, we knew capital gains tax would rise under the new Government. We didn’t know in advance to what level or when or even what reliefs might accompany a change. However, when you know something is pending you can discuss the “what if” scenarios.’
A heads up
Paul Aplin, tax partner at A C Mole & Sons, explained that his process was to listen to the Budget speech and then read through the press releases and notes from HMRC and HM Treasury and do a brief ‘heads up’ internal summary for the firm, circulated by email.
‘Following that, a short public summary then goes on the website on Budget day. This is adapted and used as the handout at our “Budget breakfast” and is further adapted and expanded for our newsletter. We also write personally to our major clients with a brief summary of the points we think are relevant to them and suggest a discussion where appropriate. Yes, it is all time intensive and yes we could buy content in, but clients recognise the fact that they are getting a personal service and it is all chargeable time.
‘If you wait for clients to ask questions you may find that what actually arrives is a clearance letter from your successor.’
A new approach
Chartered Accountants Mercer & Hole are also firm believers in the benefits of keeping in touch with their clients by various means. Tax partner Lisa Spearman explained that the firm had adopted a slightly new approach to advising clients about the impact of the new tax proposals.
‘Starting with the March 2010 Budget, the firm used its Tax Plus newsletter to introduce their clients to their tax family: dad Tom, and his son and daughter Andrew and Xena. Tom is negotiating the sale of his printing business and was naturally interested in the capital gains and inheritance tax changes. Andrew has a small business and wants to expand. The capital allowances proposals will be relevant to him, as will the increase in the VAT rate. He also wants to purchase a property, so stamp duty land tax also figures in business plans. Xena is a highly-paid employee and the implications of the 50% band, loss of personal allowances as well as restrictions on pension premiums are of interest to her.’
In addition to using newsletters, Lisa explained that the firm uses blogs and e-newsletters to keep in touch with and inform their clients, professional contacts and others that they would like to work with. All evidence of a firm that strives to be different and offers a professional service with enthusiasm as well as expertise.
Legal eagles
What if your main clientele are other professionals? McGrigors has an extensive network of accountants and other solicitors who refer work to them, primarily when their clients are being investigated by HMRC.
McGrigors regularly arrange seminars to keep that network aware of current and topical issues concerning HMRC investigations, as well as inviting guest speakers to talk on related subjects.
Phil Berwick, director in the tax disputes and investigations team at McGrigors, comments, ‘It is essential that we disseminate information to our network of contacts, so they are aware of major changes that may affect the way they interact with HMRC’. In addition to seminars, McGrigors keep in touch with their network using regular e-bulletins, a newsletter and breakfast forums.
Support systems
Leaving it to your clients to come to you for advice on the annual Budget proposals and for general tax matters is not likely to enhance your reputation as a client-centred business. If you don’t take the initiative, chances are that your clients may get their information from elsewhere and if they are getting information from somewhere else, you may find shortly afterwards that they are getting their tax and accountancy advice from somewhere else.
If you have the resources, you may find that you can prepare information for newsletters and perhaps seminars yourself, if not then firms like LexisNexis can provide personalised client publications such as Budget summaries, tax facts cards, focus guides, etc.
Whether you prepare such information yourself or buy it in from elsewhere, perhaps you should make sure that you are ‘buying in’ to the idea that the provision of information serves more purposes than simply telling your clients what the forthcoming tax rates are. They may be using this to rate you as well.
