Tax adviser – an important business partner
Today, a tax adviser is more than a specialist in particular taxes: they help shape an entrepreneur’s tax policy.
Today, a tax adviser is more than a specialist in particular taxes: they help shape an entrepreneur’s tax policy. They also recognise the effects that solutions proposed to a client may have in other areas of taxation and give the client reliable information about them, pointing out further opportunities or tax obligations. As a member of a profession of public trust, a tax adviser must act in accordance with the law, their professional oath and the rules of professional ethics. Entrepreneurs often believe that they only need an accountant, and that
a tax adviser is intended for large, wealthy companies.
Members of this profession hold a university degree, have passed a state examination and have completed professional training. They have a statutory obligation to keep improving their skills and knowledge, including by attending training courses and conferences. Only people entered on the list of tax advisers maintained by the National Council of Tax Advisers may practise this profession. Such demanding requirements give clients assurance of the high quality of services provided by tax advisers and minimise the risk of error.
After all, taxpayers’ financial security rests in the hands of their tax adviser. If a client suffers a loss as a result of an adviser’s error, they may seek compensation. This is because every tax adviser must have professional indemnity insurance. An entrepreneur using a tax adviser’s services need not worry about the security of the information they provide either: both the adviser and their colleagues are bound by professional confidentiality, including after their work for the client has ended.
The role of a tax adviser is sometimes mistakenly equated with that of an accountant. More and more taxpayers are recognising the difference between what a tax adviser can offer and what someone providing basic bookkeeping can do. An accountant’s role usually consists of receiving and recording documents and preparing accounts and returns. A tax adviser’s role may include these activities as well. Above all, however, it involves identifying and planning the tax consequences of the taxpayer’s actions. It also includes preparing or assessing documents such as contracts and evaluating business decisions that the taxpayer has made or is planning, in terms of their tax obligations. Finally, it involves comprehensive support in dealings with the tax authorities and representation before administrative courts in the event of a dispute with those authorities. A tax adviser enjoys substantive immunity when performing professional duties, and only a court may release them from their duty of professional confidentiality. An accountant does not have these rights and obligations.
In many European Union countries, the profession of tax adviser has existed for a long time, and the adviser is an important business partner. In Germany, for example, using an adviser’s services significantly enhances a company’s credibility, including when applying for a bank loan. There, as in Poland and the Czech Republic, the adviser’s role is governed by a separate statute. The United Kingdom and the Netherlands follow a somewhat different model, with tax advisers’ activities subject to less regulation.
In Poland, many entrepreneurs are still unaware of the benefits of engaging a tax adviser. It is worth seeking a specialist’s help when starting a business. A tax adviser will help select the most suitable legal structure and form of taxation and prepare registration documents for tax offices, the commercial court, ZUS and other bodies. Amid constantly changing tax regulations, the adviser will identify and explain those that apply to a particular entrepreneur and remind them of the relevant deadlines. They will explain the taxpayer’s rights and obligations. The entrepreneur no longer has to follow every change in tax law themselves and can devote the time saved to developing the business. Together with their colleagues, the tax adviser will also maintain accounting books and other records, handle HR and payroll, and advise on tax, customs and foreign exchange matters arising from cooperation with foreign companies.
A tax adviser can also help with changes to the legal structure of a business, for example from a sole proprietorship to a company, as well as with changes to the business itself, such as a division or merger, opening a new branch or closing an existing business. Granting a power of attorney to a tax adviser relieves the entrepreneur of dealing with public authorities, with all correspondence going to the adviser’s office. The adviser can also prepare and sign procedural documents, declarations and tax returns on the client’s behalf and submit them to the relevant authorities. This saves the entrepreneur time spent visiting offices and standing in queues. In court proceedings, the adviser attends hearings and represents the client by submitting all necessary documents, just as an advocate would.
A good tax adviser does not passively wait for questions from a client: they actively seek out and propose solutions tailored to that client’s particular needs. In doing so, they become a trusted partner to the entrepreneur and help build the company’s success. Many companies that have their own accounting departments and do not wish to outsource their accounting also choose to work with a tax adviser. This may take the form of occasional consultations or ongoing oversight of the business and its accounting department. Staff in accounting departments, whose expertise lies primarily in accounting rather than taxation, may overlook issues arising from frequent changes in the law. In such cases, a tax adviser can provide additional support.
It is nevertheless necessary to be aware of, and watch out for, businesses operating in the so-called grey area of tax advisory services, that is, illegally. They attract clients with low prices while avoiding costs such as training to improve their qualifications. They do not pay for compulsory professional indemnity insurance, are not authorised to represent clients before the tax authorities, or are not bound by professional confidentiality. Of course, tax advisers can help private individuals as well as entrepreneurs. Individuals may seek advice not only on completing personal income tax returns, but also on receiving an inheritance, making a gift, or planning their tax affairs and safeguarding their tax position.
To conclude, working with a qualified tax adviser is fundamental both to the security and development of a business and to gaining a competitive advantage. This important business partner can help resolve doubts and support sound decisions across the broad field of tax optimisation.
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