White paper

Winning strategies for a more profitable tax season

Tax season can be hectic and stressful, especially in today’s environment rife with moving deadlines and ever-changing tax laws. However, firms that have the right tools and business model in place can also use this time to unlock attractive growth opportunities, year-around revenue streams, and, ultimately, greater value for clients. Is your firm among them?

It is no secret that the profession has experienced significant change in recent years, with one of the biggest shifts being the rise of advisory services.

Yes, tax professionals have long provided advice to their clients. Advisory services differ in that there’s an emphasis on proactive advice versus reactive, and building a scalable advisory services model with standardized processes. It’s extending beyond compliance-based work to deliver more forward-looking, value-added services to your clients.

Firms that have effectively made the shift – which involves seizing the benefits of emerging strategies around providing services and pricing, and innovative technology – are reaping the benefits.

Consider this: A survey by CPA.com, Hinge Research Institute and Bill.com found that firms may be able to increase monthly client revenues by up to 50 percent by offering strategic advisory services – presenting one of the most important growth opportunities for firms. (Where Opportunity Meets Value: Business Model Trends for Accounting Advisory Services" (Rep.). (2020).)

To help firms unlock winning strategies for a more profitable tax season, this white paper provides actionable tips and insights that can be set in motion today.

The power of advisory

Clients want proactive, strategic advice. And given today’s complex business environment and ever-changing tax laws this should come as no surprise.

In fact, a recent survey from the Thomson Reuters Institute found that 95 percent of tax professionals believe their clients want business advisory services. This client demand was further accelerated by the COVID-19 pandemic, as clients sought advice about everything from applying for Paycheck Protection Program loans to how to manage their finances to keep their businesses afloat. (Thomson Reuters Institute. (2021, February 9). A Sizeable Majority of Tax Professionals See Future in Advisory, Thomson Reuters Study Finds [Press release].)

Looking ahead, the survey also found that tax professionals see this increased demand for business advice lasting beyond the pandemic. (Thomson Reuters Institute. (2021, February 9). A Sizeable Majority of Tax Professionals See Future in Advisory, Thomson Reuters Study Finds [Press release].)

Continued Hill, "The more that firms grow into that they begin to shift the center point of the relationship away from the compliance to the advisory and say, ‘This is where it starts and ends. We start and end with what are the client’s goals? What do they want to achieve?’ And our compliance work becomes the barometer for how we are doing. It becomes that progress report for how we are helping the customer accomplish those goals, whatever those goals may be."

According to the CPA.com, Hinge Research Institute and Bill.com survey of both accountants and business professionals — which took place prior to the pandemic — 60 percent of the accountants surveyed reported that they offer strategic advisory services. (Where Opportunity Meets Value: Business Model Trends for Accounting Advisory Services" (Rep.). (2020).)

As noted earlier, the survey found that firms may be able to increase monthly client revenues by up to 50 percent by offering strategic advisory services — presenting one of the most important growth opportunities for firms. (Where Opportunity Meets Value: Business Model Trends for Accounting Advisory Services" (Rep.). (2020).

Business professionals who participated in the survey identified the following areas as most desirable when it comes to strategic advisory:

  • Revenue growth and business modeling (65 percent)
  • Budgeting (46 percent)
  • Tax planning (38 percent)
  • Risk management (38 percent)
  • Advanced KPI reporting (35 percent)

(Where Opportunity Meets Value: Business Model Trends for Accounting Advisory Services" (Rep.). (2020).)

The benefits of advisory services are becoming increasingly clear. Such services enable firms to strengthen client relationships and provide a more consistent revenue stream for the firm — all factors that prove especially important in today’s complex and uncertain environment. And tax time can be an ideal time for firms to uncover the growth opportunities that exist within their client base.

While there’s no doubt an increased shift toward advisory services is happening within the professional, some firms may still be navigating how to successfully implement advisory and better understand how it will impact their business model.

Unlocking opportunities during tax season

Tax season is a busy time of year, but with that means it’s when the most client data and the most opportunities will come across a tax professional’s computer screen compared with any other time of the year. The key is identifying and seizing those opportunities amidst the commotion. Having the right mindset, tools and strategies in place are essential.

Continued Hill,

In other words, tax professionals must remember that tax time is not about volume – it’s about opportunity.

Echoing the sentiment, Paul Miller, founder and owner of Business By Design in Minneapolis, Minn., said in a recent webcast hosted by Hill,

Continued Miller,

Make it easy

One way to help staff identify advisory opportunities is to ensure they have the tools in place to facilitate that process. In short, make it easy.

How? This could involve identifying the metrics that staff can use to quickly know which scenarios equal opportunity.

For example, if a tax professional sees $75,000 worth of revenue sitting in a sole proprietor tax return that can be flagged as an opportunity to shift to a different entity selection and to potentially look into the S-Corp.

Establishing the proper number of scenarios or database signals to watch for is also important to help keep it manageable for staff. For instance, firms that are newer to advisory should have a shorter list of scenarios for staff, compared with a firm more experienced in advisory, so they can ease into it and focus on gaining more experience and confidence.

Consider the following guidelines:

  • Firms new to advisory: Identify two to four opportunity scenarios or database signals staff should watch for when preparing returns.
  • Firms more experienced in advisory: Identify between five and seven opportunities to be looking for during tax season.

Also, make it easy for staff to communicate and make note of those opportunities. For example, such opportunities can be noted in the firm’s practice management system.

And, as noted by Brittany Lanphier, managing partner of Denver, Colo.-based firm Lanphier LLP, in the same webcast hosted by Hill, keep in mind that client questions can lead to deeper advisory opportunities. Therefore, having the tools in place to help identify and address those opportunities can further empower staff.

She noted that staff is encouraged to spend any down time familiarizing themselves with the topics within the library to help them absorb the information and more easily identify and approach opportunities going forward.

When a firm member does identify an advisory opportunity, an office manager is then brought into the conversation to help track and get a client meeting on the calendar for after tax season, Lanphier said.

Setting client expectations is also important. This can be as simple as developing a very short pitch of sorts that staff can tell clients when they deliver the tax return. This enables preparers to tee themselves up for the sales opportunity when they are not as busy and set the expectation. Here’s one example of how that could look:

Tax preparer to client: “We went through your tax return and, by the way, we think we can help you next year have an even better impact to your bottom line and help you achieve your goals in a better way. We’d like to talk to you about that when we’re a little bit slower. We’d like to give you a call in May or June to explain what it looks like, what it would take to get there, and what your results could be. How does that sound to you?”

Said Miller,  "I don’t even think what we do is even selling. All I do is tell people what I’m passionate about, what I believe in. … I think that’s helped my staff get over this idea of introducing new concepts, and, ‘How is it going to work?’ and, ‘I’m not good at sales.’ It’s just your passion. It’s what you believe in and helping other people, and then you’re just explaining how things work. We’re more teachers than sales people."

Have the right tools and resources

Leveraging the right technology tools and resources is essential to effectively identifying and providing advisory services. This is especially true as ever-changing tax law changes have become the new norm. In fact, some of the best advisory opportunities come about when there’s regulation change.

The questions that firms must then consider include:

  • How does the firm keep up with regulation change as part of its opportunity identification?
  • How does the firm leverage its firm management system to facilitate client communication?
  • From a planning perspective, are the right tools in place to visually illustrate to clients the impact and further demonstrate the value to clients?
  • How does the firm effectively set scope and expectations?

Implementing a market-proven roadmap can help firms address these questions, and successfully build a scalable advisory services model with standardized processes. This results in increased revenue and stronger client relationships.

When looking for the right tools and resources, consider a comprehensive, integrated solution that delivers the following:

  • Industry-relevant content and tools (videos, templates, pricing tools, checklists, etc.).
  • One-on-one individual coaching sessions with a dedicated consultant and access to online learning courses to assist with implementation.
  • Ongoing coaching.
  • Access to CPE-qualified, advisory-focused webinars.
  • The ability to access all your advisory projects from one location, including easy access to your most recent projects.
  • Generates output to help communicate scenarios to your clients.
  • Surfaces opportunities for advisory services from your existing client base.
  • The ability to customize client-facing handouts with your firm’s branding.
  • The ability to streamline and manage workflows on a single platform.

Get paid for your value

When providing clients with advisory services it is important to fully understand the value of the services being provided and to price them accordingly.

As discussed in the Thomson Reuters white paper, Strategically pricing accounting services: Should you use value-based pricing or fixed fees?, there’s more than one way for firms to price their client services. However, value-based pricing is an ideal fit for those firms providing value-added advisory services.

Under this pricing model, the price is established before the works begins and firms charge for the client’s perceived value of a service. In other words, it’s the value that determines the firm’s price.

Value-based pricing enables firms to drive profitability because they can demand a higher price for their expertise. And once clients fully understand the value of the knowledge and business offerings being provided, most will agree to pay a premium price.

As noted in the white paper, firms should value the knowledge at different price depths or tiers when setting the fees. Consider, for example: What type of advisory services is your firm delivering? What type of value does it bring to the client? (Thomson Reuters, 2020, Strategically Pricing Accounting Services: Should You Use Value-Based Pricing or Fixed Fees?)


Tax season is no doubt a busy time of year, but that doesn’t mean firms should overlook advisory opportunities. In fact, it’s a prime time to identify advisory opportunities given the influx of client data and natural client communication that takes place at tax time.

Is your firm ready? Does your firm have the right tools and business model in place to seize additional growth opportunities this tax season? If not, it’s time to take your services to new heights.

Turn to a trusted solution provider, like Thomson Reuters, who can help your tax practice implement a market-proven roadmap to build a scalable and successful advisory services model. What are you waiting for?

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