For those of you who go to early morning network meeting’s (often an excuse for someone else to cook you breakfast), you may have experienced the dreaded 60 seconds – stand up and talk to the group about yourself, what you do and who would be your ideal client, for one minute. At BNI (which I used to attend), it was suggested that you close your 60 seconds with some sort of catch-phrase so you could cement yourself in your fellow attendees “front of mind”, while they were out and about, should potential referral opportunities arise. My jingle was –
“If taxation’s your pain, remember my name,
Richard from Gilligan Sheppard.”
For some years now, I have completed most of the firm’s in-house tax work, whether it be dealing with IRD risk reviews or audits, assisting the team with answering their client’s tax questions, or preparing more detailed tax opinions on specific issues.
Just over a year ago we decided to go external, offering essentially an outsource service to other accounting firms in the wider Auckland area. We commenced our project by sending an introductory email to numerous small to medium sized firms, followed up by a telephone call to see whether they were interested in meeting to discuss what we had to offer. The response was positive, and the number of firms utilising the service has continued to grow.
One area that I often get involved in, is assisting other accountants with their clients who presently are the subject of an IRD review. The services provided in this regard can range from purely strategic advice as to how to deal with a particular aspect of the review, through to full management of the case where the accountant may lack some expertise in the taxation issues raised by the Revenue, or simply not have the capacity to dedicate to the time required to complete the review.
My ability to assist these accounting clients on a cost effective basis, has been greatly enhanced by Accountancy Insurance. Their product, known as audit shield, was introduced into the NZ market (originated in Australia) in 2011. Annual premiums are based on types of business structure and turnover, and the policy provides cover for professional service fees up to certain limits in the event of any IRD review.
To me, audit shield was a breath of fresh air, and with IRD audit activity on the constant increase, certainly a no-brainer for those clients with a trading profile which would suggest it would only be a matter of time, before they were subject to a review. The product in my view, now provides a somewhat more level playing field, particularly where an IRD review moves into the disputes phase, most commonly because the IRD investigator and ourselves have differing points of view with respect to the correct tax treatment of a client’s receipt or payment.
Historically there always had to be a cost/benefit analysis undertaken at the outset of any review, and often the risk of a lengthy review process, with no guaranteed successful outcome, meant that cases were conceded early on, not based on the merits of the technical arguments, but simply due to the costs involved in defending ones position, no matter how certain you were that your interpretation was correct. Having your client’s professional costs now covered by audit shield however, allows you to progress your arguments some way down the track, enabling you to determine the strengths and weaknesses of the IRD’s case and thereby allowing you to make more informed recommendations to your client’s as to whether they should continue to pursue the dispute or not.
Management of audit shield, including the making of any claim, is dealt with entirely by our team, so the only action actually required by the client, is making the payment of the annual premium when due. So if you are not already using the product, and would like to find out more, please do not hesitate to contact your advisor or myself.
Finally, if you know of anyone who may be interested in using our tax advisory services, including:
- Q & A simple advice facility;
- Preparation of detailed tax opinions;
- Assistance with IRD reviews and audits, and/or;
- Assistance with managing IRD debt,
then remember to tell them that, if taxation’s their pain, then they should remember my name, Richard at Gilligan Sheppard.