Is it always best to ask for the most experienced tax preparer?
Thursday, July 5th, 2007In my last blog I talked about the best times to visit the tax agent, and by now you know all about how you may get tax preparer who has 30 years experience or is a total newcomer. You might think from what I said then that you should always go for the most experienced person in the office. Should you?
Not necessarily.
Let’s look at some of the pros and cons of using an experienced tax preparer versus using a lesser experienced one.
Newbie
For:
- Because they are new the returns these people submit will be scrutinised very carefully by the accountant at the branch office. All returns are double-checked before they are submitted to the ATO, but these particular returns are checked very thoroughly
- The senior preparer working with them in the office will keep an ear on what the newbie is doing and will stop any problems before they start
- The preparers have a checklist to follow to ensure they cover everything. Because they are new, they will go through every item in this checklist
- It is generally easier to get an appointment with the newbie
Against:
- They are inexperienced
- They follow those checklists slavishly. Sometimes too slavishly. It can be really annoying, for example, if you have already told them you are single and they persist in asking about spouse rebates
- They don’t pick up on things you might say in passing that might lead to extra deductions
- Will take longer to do a simple return.
Experienced
For:
- Won’t take as long to do
- You are likely to get more deductions, because these people really know tax
- They know what questions to skip. If you’re single, they won’t ask about spouse rebates
- They follow up on things you might say in passing that lead to extra deductions
- Can answer general tax-related questions without having to refer to someone else for the answer
Against:
- In the first month or two they will also be keeping an eye on the newbie, so you don’t have their whole attention, just most of it
- There is pressure on these people to do more returns
- It is often harder to get an appointment with them, as prior year clients specifically request them.
Even so it still appears, on evidence, that you are better off getting an experienced tax agent to do your return; and in general that is true.
There is one other factor you should consider however, and that is the tax preparer’s personal experience.
If you own shares or real estate investments, you are far likely to get a better return if it is done by a tax preparer who also owns shares or real estate investments than you are with someone who does not. Likewise, if your tax preparer has children they are far more likely to really know rebates and offsets and tax deductions for child care than someone who doesn’t have children.
I am not saying that you will necessarily get a bad deal with the other tax preparers. You will get standard deductions, but there’s really no substitute for experience.
Take myself, for example. I own shares and investment properties, so I am a good person to talk to if you have investments. However, I do not have children so all I know about child care rebates and tax offsets for dependents is from the tax rules. Therefore if you have no investments, but you do have children, you are better off going for one of the newer people in the office who does have children, because they have their personal experience to draw on here.