Trying to decide if it is time to hire a tax representative is a difficult decision and if made incorrectly, can cost hundreds if not thousands of dollars plus add significant amounts of stress and reputational damage to you and / or your business.
With so many people and organizations on the Internet promising to do so much for you, how do you know who to trust and more importantly, how can you tell if the specific tax matter you have is something they have experience (and success) handling?
Well, I’m going to give you some tips, so feel free to share them, about how I would go about finding a tax expert for my situation and what important questions you need answered before you hand over your hard-earned money, Social Insurance Number (SIN) and / or Business Number (BN).
The first thing that you must be comfortable doing is asking questions and if you do not understand the answer or if it seems like the response you get is part of a sales pitch, then think twice and get another quote. It’s okay. Anyone offering these services will either expect that you have spoken to more than one person, or will be confident that their expertise is what you need and know that you will come back.
Do they offer a free consultation? It’s helpful if you do not know exactly how much trouble you are in, if at all, and having a few minutes to ask will put your mind at ease and help build a relationship for the future if it’s necessary.
During a 15-minute free consultation I usually do not know how many other tax representatives they have spoken to, if any. As a result, I have to be clear, honest and set the price based on the amount of work involved, only. It works for me, and it works for my clients.
Once I begin working with clients I get to hear what others promised, or wanted to charge, and often times I am surprised both by the recommended course of actions and the price quoted / charged.I thought it might be a good idea to expand on this topic and provide the 13 IMPORTANT considerations to look for before hiring tax representation:
13) Knowledge – Does this person or organization have significant knowledge in the area you need?
12) Experience – Knowledge is great to help you understand more, however, is their knowledge based on books they studied in school, or was it gained through hands-on experience? If you are lucky, you can get both.
11) Fit – Can you work with them? Are they able to explain in a manner that you actually understand what happened, and what the next steps are.
10) Advertising – Odds are good that if they are spending a lot of money on advertising, they are going to have to charge you more in order to re-coup the costs. A lot of advertising doesn’t necessarily mean they are the best, it just means they value advertising, or need clients..
9) Social Media Presence – Taking into consideration that people do NOT advertise they have a tax problem online, it can be difficult to see if your prospective tax representation is worth your hard-earned dollars. A good way to check up on a prospective hire is to have a look at their followers and who they follow. It may seem great that a firm will have 5000 followers, however, followers can be bought, so a Canadian firm with 3000 followers from, say, Turkey might be a tip-off that something is not right. Also look at their posts and comments via mainstream media. Are they commenting on articles to educate or does everything they publish and promote look like it has been written by a marketing firm aimed at trying to get you to hire them.
8) Flexibility – Are they flexible in their pricing, or are they so set in their fees that they will not, or can not, recommend someone else or reduce their fees to assist.
7) Promises – Do they promise to save you money through reviews of your tax filings or do they take the easy way out and recommend bankruptcy, or a proposal?
6) Fear Mongers – If you notice that the tone of everything coming from a prospective firm / representative seems like they are trying to scare you, they are, and that’s a good sign to proceed with caution. If they tell stories of the CRA hiding in your bushes, reading your emails or coming to arrest you, you should think twice.
5) What is their catch? – You know what you need, but what do they want, or what do they want from you? There might be additional things relating to your tax issues that you did not know about and would benefit you, but if it’s not necessary and they won’t back away from it – like a financial analysis – then be concerned that they just want to put you though a cookie-cutter program instead of working towards solving your problem(s).
4) Do they play nice with others? – Blog posts aside, are they active in community networking groups (like on Linked In) and are they contributing to the discussions or do they have their own agenda and are just posting articles aimed at the wrong crowd – ie/ pitching their services to individuals in a group full of tax lawyers.
3) Sticks and Stones – How do they refer to the Canada Revenue Agency? Do they call the CRA the “Taxman”? Do they have other negative nicknames? I can tell you with the experience that 10-plus years of working for the CRA has afforded me that the CRA HATES that and do you really want your representation to start your negotiations off on the wrong foot?
2) Which Way is Up – Does their projected course of action come with terms, such as; “I think, this will work” or “I can try this…” or does the word “maybe” come up a lot? The good part of that language is that it is a sign that they want to try a course of action and they expect the outcome to be positive or they have no clue what to do and after they run you through their cookie-cutter service, they hope you will be in a better situation.
1) You are Smarter – If you finish your conversation and get the feeling that once all is said and done you will be in a much better place both mentally and financially and you are armed with enough information and understanding of what got you there in the first place and that you can and are able to identify and address all future issues, then you might just be in the right place!