Should I Really Hire An Accountant For A Tax Return?
Tax season already causes stress, and often uncertainty and people question whether accountants are needed. Attempting to do taxes yourself, however, can create more problems and more stress for you.
Divorces, deaths, business expenses, financial statements, securities and larger transactions are all events that are best handled by an accountant.
Not every taxpayer will need an accountant. For the more simple cases consisting of a few T4 forms from employers, there is software and online services that can assist with filing. Most tax lawyers, tax preparation services and accountants will agree that in these cases there is no need to work with a professional.
More complicated returns are a different story. If you have sold property or perhaps are self-employed, there is more that goes into a return then you probably anticipate. Capital gains exemptions for property and business incomes and deductions for the self-employed are just the surface of items that need to be considered. Taking the time to learn what these are and how to include them is better spent having an accountant handle them.
Another benefit of accountants, perhaps the greatest one is how well they know and can deal with audits. Being audited is any taxpayer’s worst nightmare and avoiding them all together would be ideal. Accountants can be considered as the superheroes of the audit world and are worth having around just for those situations. Not only can they ensure that every detail is covered since they know what is considered a red flag, but they can also help you work with the Canadian Revenue Agency as an intermediary in the event you are chosen for audit.
There are, however, certain times when it is more advantageous to work with tax lawyers that not many people will think of. Since the government decided to reward those who reported any tax cheats, it is a solid idea to have an accountant to disclose these to. As any lawyer will deem the conversations between accountant and client as privileged, this is the best way to handle any possible illegal activity.
Experts that have dealt with offshore accounts and admissions of former tax evasion insist that having a person with tax law knowledge in your corner will be to your benefit for sure. The law recognizes the confidentiality of the relationship and communication between tax lawyers and their clients, so while it is not acceptable for lawyers to lie in court, they cannot be forced to testify against their clients. The only exception to this rule is if the client admits they are about to commit a crime.
In the meantime, the lawyers can work with their clients on how best to deal with those trickier and potentially illegal situations. Circumstances may exist where a client will need to get money from an offshore account, as an example. They decide to disclose the details to their lawyer, but when they are informed of the costs involved with rectifying the situation, they continue to avoid it as they have previously done. A tax lawyer can only advise them of the right thing to do, and if ignored, they are still bound to keep communications private.
There is no need to be alarmed because, for the most part, an accountant can handle your returns. Most audits are not looking into potential evasion but rather concerned with shy things were filed in a certain manner. For these great number of situation, the accountant who prepared the files is best suited to provide the answers the government is seeking. While a lawyer can help you with sticky situations, accountants are better equipped for long term relationships and a clear and personal understanding of your financial life.
Divorces, deaths, business expenses, financial statements, securities and larger transactions are all events that are best handled by an accountant. A tax lawyer will not have the detailed knowledge to get these files in the best and most efficient manner, giving accountants the upper hand. Unfortunately, accountants will have their conduct codes regarding confidentiality, but these are not recognised in a court of law as privileged. So while they are better for your average filing of returns and tax-related advice, legal matters are still best handled by a tax attorney.
With the increase in options that are available for tax preparation and the sometimes specific need for a tax lawyer, there are questions regarding the need for accountants. Tax lawyers handle the more complicated situations in the event something illegal may have occurred. Tax software and preparation firms can handle most tax situations and some companies, like H&R Block, offer tax schools to their clients, letting them learn how to do their taxes themselves.
So what exactly can an accountant deliver? Taxes are their life, and their intricate knowledge and expertise for the system allow them to bring you a service of high efficiency that you cannot bring yourself. With taxes being such a nightmare, accountants can bring you an ongoing trusted financial relationship, and they deliver confidence and peace of mind. Money matters to everybody so all you need to ask yourself is, what better person to have by your side?
As a Chartered Professional Accountant in Surrey, CP Lehal & Company can provide affordable accounting and financial services to minimize tax liability, and maximize your tax savings. Our Surrey Accountant provides clients with utmost assistance in Corporate and Personal Tax, Auditing, Review Engagement Reports, Business Consulting, Bookkeeping & Payroll, T4, GST, WorkSafeBC (WCB) and Employer Health Tax (EHT).