Tax consultants help individuals and businesses in making the right financial decisions. Their role in preparing and filing tax returns is extremely valuable. By learning about their exact role, responsibilities and skill requirements, you can identify whether this is a suitable career for you. In this article, we explore how to become a tax consultant, why the role is important and discuss what skills and qualifications you need to excel in the career.
What is a tax consultant?
A tax consultant is a financial expert who uses advanced knowledge of tax laws and codes to help clients meet their tax obligations. They ensure their clients remain compliant with the law while minimising their tax liability. In addition to preparing tax returns for clients, tax consultants also offer advice on related financial concepts like investments.
Tax consultants spend most of their days on their desks calculating figures or meeting with clients. They use a variety of tools to simplify the process of preparing and filing tax returns. They must be aware of the latest developments and changes in tax laws and regulations.
How to become a tax consultant
To become a tax consultant, follow these steps:
1. Understand what the career entails
Find out basic information about Indian tax laws and understand the role of a tax consultant. Talk to established tax consultants and practitioners to clarify any doubts. Make sure you understand the responsibilities that come with the job before deciding to become a tax consultant.
2. Get the right education
While studying commerce subjects in your senior secondary (10+2) is advantageous, you can become a tax consultant even if you have studied science or humanities subjects. Graduate students in law, commerce, mathematics, accounting and banking can become tax consultants. Find an education path that works well for you and your schedule so you can be successful in school.
3. Complete specialised programmes and certifications
There are many ways to become a licensed tax consultant, and most of them require specialised training programmes and certifications. The programmes offered by The Institute of Chartered Accountants of India (ICAI) and The Institute of Company Secretaries of India (ICSI) are the most direct ways to become a tax consultant. There are also several government-registered short-term and distance education programmes to help people start a career in the tax consultancy sector.
4. Get professional experience
It is ideal to obtain adequate professional experience by working in a chartered accountancy firm, consulting services firm or financial services firm. You can begin an apprenticeship or internship during the final year of your programme and take up a full-time role after finishing your training. Experience is a highly sought-after trait in tax consultants.
5. Start your practice
Once you gain sufficient experience, you can set up a private practice and work directly with clients. However, it is important to remember that a tax consultancy business comes with certain responsibilities and client requirements. Ensure that you provide your clients with the best service and sustain their trust.
What are the different kinds of tax consultants?
While most tax consultants offer a wide variety of services, they usually specialise in one or two of the many types of taxes:
Income tax consultant
Business tax consultant
Goods and services tax (GST) consultant
Capital gains and losses tax consultant
Property tax consultant
Vehicle tax consultant
Tax consultants must have in-depth knowledge about all their chosen fields of specialisation and must keep obtaining new certifications to expand their competency and offerings.
What qualifications do you need to be a tax consultant?
People with the following qualifications can become tax consultants:
Clearing all levels of The Institute of Chartered Accountants of India (ICAI) programme
Clearing all levels of The Institute of Company Secretaries of India (ICSI) programme
Registered members of the Bar Council (L.L.B.)
Clearing all levels of The Institute of Cost and Management Accountants of India (ICMAI) programme
Certified by the Central Board of Direct Taxes (CBDT) after graduation in commerce, banking or management
Please note that company secretaries can become tax consultants and file returns on behalf of assessees, but they can not conduct audits or represent clients before the tax tribunal.
Estimated salary of tax consultants in Gurgaon, Haryana Skills required to become a tax consultant
Here are a few skills that help tax consultants succeed:
Mathematical acumen
Taxation involves a lot of numbers. Being able to make projections, calculate percentages and interest and account for profit and losses is vital to the role of a tax consultant. Thus, a strong foundation in mathematics, economics and financial concepts is required.
Eye for detail
Preparing the paperwork for tax returns is a long and comprehensive process with many opportunities to make errors. Tax consultants should spot these mistakes quickly upon review and must have strong attention to detail to identify even the most minute inconsistencies. Accuracy is one of the biggest strengths of a tax consultant, as any oversight in the tax filing process can cause non-compliance or violation of the tax law.
Problem-solving
Businesses and individuals often approach tax consultants with unique financial situations. Tax consultants must apply their knowledge and provide the best possible solution that helps their clients. Therefore, strategic thinking and planning to solve problems is an important part of the job.
Client management
Managing clients and ensuring their satisfaction is critical to the success of tax consultants. Engaging clients with regular updates, offering them the best advice and building a personal rapport to retain them are a few things that a tax consultant must be able to do. To do well in client management, you can keep a file folder for each client with their unique financial and tax situations, along with their contact information and any other pertinent information.
Communication
Tax consultants are able to explain complex and confusing tax-related concepts to clients with low levels of financial literacy. Whether it is helping a working professional cut down their tax liability with the right investment or filing the GST returns for a business, tax consultants must have strong communication skills to explain tax strategy and implications and provide advice. They must be responsive to the needs and requests of their clients.
What is the salary of a tax consultant?
The average salary of a tax consultan is ₹ 3,72,540 per year. However, this figure can vary drastically based on your company and location. The average salary of tax consultants in Delhi is ₹ 10,22,437 per year. Similarly, the is ₹ 5,31,078 per year.
Is tax consultancy a good career?
Being a tax consultant gives you the necessary skills and knowledge to make wise financial decisions. The role of a tax consultant is a highly coveted one, and they usually earn a high salary, which grows with their skills and experience. Tax consultants also have the choice to work independently, for the government or the private sector. This flexibility, along with high career growth prospects, is the reason many people become tax consultants after studying non-commerce subjects.
How do I start a tax consultancy business?
Here is how to set up your own tax consultancy practice:
Get your paperwork in order
Before you start working as a tax consultant, make sure that your licences and paperwork are complete. Only qualified and certified individuals have the authority to act as tax consultants and offer advisory on tax-related matters. Being a licensed tax consultant also inspires confidence from your clients and helps build trust, which is essential in this sector.
Set up an office and create brand assets
Create a physical workplace for yourself, and decide your company's name, logo, identity and other brand assets. Register the company and the details of the ownership with the government and open a current account to facilitate transactions. Register your business at the GST portal to pay your business taxes.
Advertise in your networks
While studying to become a tax consultant or during your professional experience, you are likely to have come in contact with people who are in the same profession. Reach out to them and ask them to refer clients to you. Also, advertise your new business and service offerings in your personal and social network. Remember, tax consultancy is a service almost everyone requires, so it may not take very long to get your first few clients.
Provide exceptional client service
One of the best ways to retain existing clients is by offering them unparalleled service. File returns on time, respond to their queries, explain the significance of certain financial decisions and commit to their success. Try to help your clients proactively and they may refer their acquaintances to your business.
Please note that none of the companies mentioned in this article are affiliated with Indeed.
Salary figures reflect data listed on Indeed Salaries at time of writing. Salaries may vary depending on the hiring organisation and a candidate's experience, academic background and location.
