Outsourcing Tax Preparation Services to India: What UK Accountants Need to Know

20 September 2024

As the Self Assessment season looms closer, more and more UK accounting firms jump on the outsourcing bandwagon. With offshoring on a global rise in the accounting sector, most accountants are resorting to outsourcing tax preparation to India.

Several studies have revealed the rapidly changing trends in the accounting industry, and outsourcing is one of them. By offshoring tax preparation services, accountants not only get the extra help they need to navigate the busy Self Assessment season but also earn additional profits and scale their firms.

Gains from Outsourcing Taxation Services to India

1. Outsourcing tax return preparation services to a trusted provider allows accountants to scale their practice up or down according to the busy and slow periods. Plus, accountants that successfully manage to outsource tax preparation work are likely to avoid hiring additional staff come January, when there is an influx of Self Assessment tax returns.
2. Another motivator for outsourcing tax return preparation to India is the quick 24–48-hour turnaround time for each return. Because of the time difference between India and the UK (4.5 hours), a tax return sent late in the evening can be completed in time to be reviewed by the UK firm in the morning.
3. Lower labour cost is one of the biggest drivers for accountants to outsource tax return. According to Payscale, a senior accountant in the UK earns £36,502 a year. When overheads such as hiring and training costs, office infrastructure, leave and holiday pay, etc., are added to this, the total cost to the company escalates to over £50,000. On the other hand, the cost for an outsourced resource is between £25,000 to £30,000, amounting to over 40% of savings.
4. Another way outsourcing boosts business capacity is by enabling accountants to expand their service offerings. When accountants outsource tax preparation, they are in an advantageous position to take on more work and provide more services to their clients.
5. Perhaps one of the most important gains from outsourcing is that it gives in-house, front-end teams more time and energy to focus on building relationships with clients and providing advice.

Client data security – Priority # 1

When considering a personal tax preparation outsourcing solution, it is important to do it right. This means ensuring your client data is safe and secure. So, before you partner with an outsourcing company in India, do your due diligence from a security perspective and make sure that the outsourced accounting and tax preparation vendor:

• Follows world-class security standards such as ISO 27001
• Is GDPR-compliant
• Maintains Non-disclosure agreements (NDAs)

Why is GDPR important for UK accountants to outsource tax preparation work to India?

By working with non-compliant outsourcing companies, you expose yourself to a risk that has the potential for reputational damage, not to mention significant fines of up to £8,700,000, or 2% of the undertaking’s total worldwide turnover, whichever is higher.

Why the World’s Accounting Game is Played in India?

India has become a focal point for global accounting operations. As firms worldwide grapple with talent shortages and evolving professional landscapes, India’s role as a major player in the accounting domain is becoming increasingly significant.

Watch our latest podcast highlighting this shift:

• India’s strategic response to the global talent shortage in accounting and its implications for the industry worldwide.
• Insights from Global Capability Centers (GCCs) and top firms about leveraging Indian talent.
• The transformation of Indian accountants from traditional roles to leaders in advisory, audit, and financial strategy.
• Future predictions for India’s accounting profession and its ongoing impact on global standards and practices.

Unsure if outsourcing is the right solution for your firm? Assess our service with a RISK-FREE TRIAL (Up to 10 hours/2 tax returns).

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Finding and qualifying your outsourcing provider

Before you consider tax preparation outsourcing to India to help meet the demands of the upcoming busy tax season, you’ll want to carefully vet potential partners ahead of time to guarantee trustworthiness and reliability.

Nowadays, people rely heavily on peer reviews. The same applies when searching for an outsourcing provider. Ask other accountancy practice peers if they have an offshoring partner or if they know of any good ones.

Once you have a list of tax preparation outsourcing providers, you can dig further and start talking to them directly. It’s essential to establish contact so that you get an idea of how they function and their capabilities.

Also, be sure to ask for the contact details of some of their clients who have a similar practice as yours. A confident outsourcing supplier should have no problem letting you speak to their clients to get a reference for their work.

Here’s a quick video to help you find the right partner to outsource Self Assessment tax returns.

Outsource Tax Preparation Securely to India with QXAS

With the Self Assessment season already begun, it is time accountants in the UK assess their workload and hire external help if necessary. If you plan to outsource tax preparation work to India, QX Accounting Services could be the ideal partner.

QXAS is a market-leading accounting outsourcing company providing customised tax preparation solutions to growth-focused accounting firms. We provide error-free and lightning-fast tax preparation support to suit clients’ specific requirements.

We have over 20 years of experience functioning in the accounting industry and understanding the challenges of modern-day accountants. Our vast team of tax professionals works dedicatedly as an extension of your team based on your time zone.

Here are a few reasons to choose QXAS:

• Vast team of 1000+ accountants and tax professionals
• Customised pricing and engagement models
• Dedicated support and commitment to quality and excellence
• Compliance with all the essential data security standards – GDPR, ISO 27701, ISO 27001
• Complete transparency in communication
• Five-star rated tax prep solutions trusted by 500+ accounting firms in the UK
• Professionally affiliated with prestigious organisations like ACCA
• Proud winner of a 100% score on all BSI audits

To learn how outsourcing can help you sail safely through the Self Assessment season, book a free consultation with one of our tax experts or drop us an email at [email protected]. To know more about our services, log on to Outsourced Accounting, Bookkeeping, and Payroll Services | QXAS UK (qxaccounting.com).

Frequently Asked Questions

1. Why Outsource Accounting and Tax Preparation Services?

Outsourcing accounting and tax preparation services in the UK can provide numerous benefits to accountants. It allows for cost savings, access to specialised expertise, scalability, and increased focus on core business activities. By partnering with a trusted outsourcing provider, UK accountants can streamline their operations and enhance overall efficiency.

2. How Easy Is It to Outsource Tax Preparation to India?

Outsourcing tax preparation to India is a viable option for UK accountants, as it offers ease of access to a highly skilled and cost-effective workforce. All you must do is find the right outsourcing provider and communicate your requirements to them. The outsourcing company then sets up the entire process for you.

3. How Much Does It Cost to Outsource Tax Preparation Services to India?

The cost of outsourcing Self Assessment tax returns to India depends on the nature of your requirement. Most outsourcing providers offer attractive Early Bird and volume-based discounts. If you already outsource your accounting and other functions, you may likely get specialised rates from your outsourcing partner.

Typically, the cost of hiring an experienced outsourced resource is between £25,000 to £30,000, which can save you up to 40% of your in-house costs. Click the button below to request a custom quote for tax preparation services based on your needs.

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Dineshkumar Gadhavi

Dinesh is a seasoned accounting and tax professional with more than 20 years of experience, specialising in UK personal tax. He has a proven track record of streamlining tax processes and building strong client relationships, consistently delivering accurate and compliant taxation services tailored to client needs.

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