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Work smarter, not harder this tax season

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Jackeline Velez

Jan 21, 2021

This article was originally published in Latino Tax Pro.

Are you stressed? If you’re a tax professional then the answer is probably “Yes”. As the tax season is upon us – right after going through a seemingly endless tax season last year, you might be wondering how you are going to do it all. We have tools to help you become more efficient, less stressed, have happier clients and maybe even make more money. 

A reminder to prioritize your self care and mental health

Maintaining good physical, emotional and mental health is key for a productive tax season. While we can’t always avoid working long hours or deadlines, we can change the way we approach these things. It might be counterunitive or difficult to justify self care during busy times, but you will be more effective at work when you can bring your body and mind back to a state of wellbeing. If you aren’t taking care of yourself then you can’t give your best self to your clients and families.

There are many modalities to maintain our mental and physical health that only take a few minutes a day. A simple tip is to become aware of how we breathe. There are studies by organizations like the Heart Math Institute that show that once our heart and brains are working in coherence, we feel less stressed and more in tune with ourselves. 

How healthy are the processes within your tax practice?

Once your body and your mental systems are in balance we can take a look at the systems within your tax practice. Do you have clients that come in with a shoebox or bag full of faded receipts? Are you catching up on years worth of transactions during tax season, rushing to get a tax return done? If so, below are some tips on how to use cloud accounting and Xero to prevent you from doing tons of catch up work during tax season and possibly generate revenue from your clients year round. 

Going paperless

If you are one of those tax professionals who is getting a box of receipts from clients, you probably would like to never see such a box again. Not only is it time consuming to enter everything manually, but there can be missing information from losing receipts or faded ink. 

We recommend using tools like Hubdoc or Xero Files to go paperless. Hubdoc will read the receipt and add key information directly into Xero. It will also capture an image of the receipt and store it in Xero so that your client is audit ready. Xero Files is a simpler way to extract and store files into Xero so that you can code the transaction to the correct account manually with the image for reference. Both tools allow you or your clients to send the information to Xero quickly via a mobile app or email. 

Introducing automation

If you are coding transactions one by one, you are losing time and money. When you are a tax or accounting professional, your time is a cost that will impact your bottom line directly. The work must be done no matter what, so you can decide whether to use technology to automatically do the majority of it or to use your time – which is ultimately a cost for you. 

Cloud accounting tools allow us to use technology for automating data entry so that you and your staff can spend more time working with clients, analyzing data and doing the work that only humans can do. Providing advice and insights on their financials will be more valuable to your clients than your data entry skills.

Cloud accounting tools

You may have the banking data in the accounting system, but then how do you get it categorized into the correct account and get it ready for the tax return quickly? Xero offers two wonderful tools for this called cash coding and bank rules

Cash coding allows you to bulk reconcile transactions at once so that you can reconcile a year’s worth of transactions in just a couple of hours. If you have one of those clients that didn’t keep accounting records all year, this will speed up the process of coding the transactions to  the right account so that you are ready to work on the tax return in no time.

Bank rules are extremely helpful for both monthly clients and clients you see once a year. Using cash coding in conjunction with bank rules is the most powerful way to reconcile in Xero. Bank rules allow you to essentially pre-code a transaction based on data that Xero will recognize such as vendor name or reference information. Bank rules will be saved in your client’s organization automatically and ready to be reconciled using cash coding with just the click of a button. Using this tool will help you for tax seasons to follow. 

Better conversations with your clients

Once you start working in the cloud and utilizing these tools, you are opening up opportunities for amazing new ways of working with your clients. You now have the ability to work with clients in real-time because you have introduced automation. Since you can whip up a professional and polished profit and loss statement quickly, you can present it to your clients to show how you can provide insights on their business all year long and how you can help them make big decisions for their business. 

By sharing these simple insights, you are able to have a conversation with your client that motivates them to see their accounting data and interact with you more than once a year. This sets you up as a trusted advisor and provides opportunities to add on services such as bookkeeping. Having the numbers in real-time and an advisor like you gives your clients the power to make more informed and timely business decisions.

We might not be able to control our clients, legislation, pandemics or natural disasters but we can control how efficient our processes are within our accounting firm. We also have the ability to care for our wellbeing to give ourselves, families and clients the best experience. Get started by joining the Xero Community today.

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