It’s A Golden Age For Tax And Accounting Professionals That Keep Up With Technology
But to survive competition and reap the benefits, these professionals will need to embrace technology as their best tool, whether they are serving large or small business clients
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The Goods and Services Tax (GST) has been a game changer for businesses since its introduction on July 1, 2017. It has brought scores of both opportunities and challenges for business professionals across India.
For one group in particular, chartered accountants and other tax professionals, opportunities abound since the introduction of the GST. In fact, there has been a significant increase in demand for tax preparation services. More businesses than ever are reaching out for help with GST registration, accounting, return filing, and tax payments. This has led to surge in revenue for chartered accountants and other tax return professionals and has placed those new to the profession on same plate as experienced professionals. As it is rightly said, however, every opportunity comes with its own set of challenges, and this is also true for tax and accounting professionals.
In India, the knowledge of tax law among average businessmen and women is as scarce as hen’s teeth. This lack of knowledge results in a dependency on chartered accountants, and places even more responsibility on them for being well-versed in every provision of GST. Further, updates, additions, and revisions in GST law have been a weekly affair, thus chartered accountants must be on their toes in order to properly guide business clients. Keeping up-to-date on all the latest tweaks to the law can be a challenge, even for professional accounting officials.
Moreover, tax and accounting professionals have an enormous role in helping government fulfil its new digital endeavour. Unlike the previous tax law, GST compliance is done entirely online; thus, chartered accountants must be well-versed in technology. Senior chartered accountants may be less digitally literate or reluctant to adopt new technologies. For many of them, GST requires unlearning the old system first, and then learning a new one. The digital requirements of GST essentially mandate that chartered accountants be tech-savvy in order to survive the competition for their services.
Increasing compliance has been the core goal of GST. That said, however, GST was envisaged as a law with fewer tax compliance requirements and a simpler tax policy compared to the previous tax structure. Unfortunately, this vision appears to be far from being becoming reality.
Though the early-day jitters surrounding GST’s new, digital compliance features have given way to general acceptance, teething troubles remain. Every aspect of GST compliance — from registration to payment of taxes, return filing, and refund claims — are online. No matter how convenient this may seem, however, this digitisation cannot replace the qualified tax professional’s ability to apply the correct law to one’s own tax situation. Tax compliance is not a new challenge for accounting professionals, but with heightened due diligence and increased penalties, chartered accountants and other accounting professionals face increasing concerns since the adoption of the GST.
Chartered accountants who handle big corporate clients face different challenges than those handling smaller clients.
Large corporate clients
GST calls for larger corporate clients to address many new details that many tax professionals have not been able to capture. For instance, GSTR-9 requires a Harmonized System of Nomenclature (HSN) report of inward supplies. This information was not needed previously while filing monthly GSTR-3B returns and so most businesses did not maintain these records. Reporting on them now is therefore cumbersome. Fortunately, tax automation software created to aid in GST compliance will help with this by automatically fetching data from purchase registers.
Smaller businesses clients
Smaller clients may not be able to provide required data on time for reasons varying from lack of resources to general ignorance. Thus, their chartered accountants are often blamed for mismanagement and untimely return filing. To resolve this, many chartered accounting firms deploy practice management software, such as Jamku and CCH ifirm, which function as a knight in shining armour, rescuing many firms by significantly improving their overall efficiency.
Thus, to conclude, the world of GST is entirely online, and chartered accountants and their digital knowledge will continue to be the backbone for GST compliance. It is a golden age for tax and accounting professionals, but to survive competition and reap the benefits, these professionals will need to embrace technology as their best tool, whether they are serving large or small business clients.
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