Topics: Outsourcing, Tax, Tax outsourcing services, Tax preparation, tax season

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

7 MIN READ | Posted on September 20, 2024
Written By VISHAL KURANI

outsourcing-tax-preparation-services-to-India

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. Using a good tax preparation outsourcing company 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.

The Outsourcing Market: India Vs. Other Countries

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 €20 million or 4% of a company’s global annual turnover, whichever is higher.

Must read: Data Security and Personal Tax Filing: What Accountants Must Know

How Does Tax Outsourcing Work?

The process of outsourcing Self Assessment tax work is pretty straightforward. There are three ways:

  • Working remotely: Using secure virtual technology like VPN/RDP/Citrix/GoToMyPC, the outsourcing company in India logs into your system and completes the tax work.
  • Working on a secure FTP server: All tax documents are scanned into a secure FTP portal, collected and worked on by tax teams in India, and delivered back to the portal.
  • Working on the cloud: This requires accountants to provide (their India team) login details to the cloud accounting software of their choice. Supporting documents and working papers can be sent using a secure portal.

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).

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.

If you have trouble determining whether a potential tax outsourcing partner is worth your time and money, consider the items on this checklist:

  1. Conduct a background check and ask peers and colleagues for references
  2. Interview several outsourcing providers
  3. Find out their outsourcing process and data security
  4. Confirm the fee structure in writing
  5. Check their infrastructure, staffing, and technological capabilities
  6. Establish a review period and a governance process
  7. Prefer someone who is professionally affiliated with industry bodies such as the  ACCA as it indicates they are committed to continual professional development
  8. Select someone you respect and communicate with

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

Also read: How to Find the Right Self-Assessment Tax Preparation Outsourcing Partner?

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.

What distinguishes QXAS from the rest of the tax outsourcing companies is our commitment to quality with Managed Solutions, offering a four-eyed review system. We offer a guaranteed turnaround time of 24 to 48 hours based on the complexity of the tax returns.

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.

 

Book a Free Consultation

We hope you enjoyed reading this blog. If you want our team to help you resolve talent gaps, reduce costs and transform your business operations, just book a call. 

VISHAL KURANI

Bringing forth rich marketing experience in the accounting industry, Vishal blends his wealth of knowledge and creativity to educate accountants about the pressing industry issues. He is passionate about marketing and helps accountants scale their practice through his detailed write-ups.

Unauthorized copying or plagiarism of our content is a violation of intellectual property rights. We take such matters seriously and will pursue legal action to protect our original work. Anyone found engaging in such activities will be held accountable under applicable laws.

Originally published Sep 20, 2024 03:09:12, updated Sep 25 2024

Topics: Outsourcing, Tax, Tax outsourcing services, Tax preparation, tax season


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