“Changes to the tax system.” A phrase sure to send a shiver down the spine of any taxpayer. But regulations they are a-changing, as the HM Revenue and Customs (HMRC) Making Tax Digital (MTD) initiative rolls out across the UK, aiming to make tax simpler for all. By making it digital.
Phase one – requiring all VAT-registered businesses to submit tax returns quarterly using MTD-compatible software – is already in full swing. And phase two – extending MTD to self-employed people and landlords in the UK – is in the pipeline, albeit with a slightly amended deadline (the April 2024 launch becoming April 2026).
But we know all this, right? Yes, we do. And so do the 5.5 million small businesses in the UK. The new rules are a massive deal for business owners and the self-employed, many of whom don’t use an accountant and face having to solo-navigate changes to regulations to figure out how to stay on the right side of the law.
The opportunity for accountancy firms here is obvious. A big addressable market that will be reaching out for professional guidance over the next phase of MTD. Many accounting businesses, however, will be asking themselves whether it’s worth it. And for good reason. There’s no escaping the fact that smaller clients aren’t generally our most profitable ones, so making sure that the effort is equal to the return is critical.
Digital goals require a digital strategy
The way I see it, getting ahead (digitally) in the scramble to MTD can only benefit accountancy firms. It’s an excellent time to reflect on customer engagement strategies. Specifically, looking at exactly how to service smaller clients. Looking at creative ways to remain profitable in the space, whilst still delivering a fantastic customer experience.
The problem currently is that most firms will have a standard method of contact for new customers. Maybe a form on the website, a phone number – both of which need to be staffed. And when requests explode (as they’re likely to with the rollout of the next phase of MTD), this can equate to a lot of hours with little payback. A digital, self-serve, omni-channel approach is the answer.
Good service doesn’t have to be high touch
Imagine waking up in a panic at 2am because you don’t know what HMRC’s new set of rules means for your business of one. You decide to ask an expert. You find some numbers for local accountancy firms, send a couple of emails, leave a voice message, fill out a web form or two. And then sit back and wait.
On the other side of the fence, accountants are inundated with requests for help, because – surprise – you’re not the only self-employed person looking for advice. So the emails are left unopened, the calls go unanswered, and the web forms languish somewhere on internal systems, unread.
Contrast this to a scenario where targeted advertising, say through LinkedIn, draws in the customer. Then, AI-powered chatbots provide knowledge articles and answer questions about MTD. Already, both parties are in a better position. The business owner has the information they need, and the accountancy firm has deflected a non-fee recoverable activity.
Next, the business owner can schedule a virtual appointment and connect with a client support advisor. And, if they go on to decide they want to engage the accountancy firm’s services, they get access to a personalised web portal that takes them through the onboarding journey. Once onboarded, the client advisor gains a 360-view of the customer, which not only helps build a strong relationship, but provides insight that enables cross and up-selling.
The key is that at every stage the customer is connecting on the channel of their choice, resulting in both an enhanced customer experience and a higher conversion from first engagement with the accountancy firm. And accountants’ valuable time is spent doing the work that they enjoy and is fee-recoverable. This is especially important given that attracting and retaining talent in the accountancy space is tougher than ever.
Putting your best digital foot forward
While MTD provides the impetus to assess how you convert smaller clients, there’s a much wider imperative to digitise your customer-facing processes. Competitive advantage.
Accountancy firms that embrace digital transformation now rather than later can capitalise on new opportunities for growth and increased market share. It means they can provide a customer-centric service effortlessly and with no impact on profitability (well, only a positive one). It also means they’re ideally placed to provide services that appeal to the emerging digital-first generation – the entrepreneurs, start-ups and self-employed businesses of today and tomorrow.
As customer strategies go, it’s a win from every angle.
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