9 Questions to Ask your Tax Preparer

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tax time concept with sign post under blue skyIt’s April 15th and about the time that everyone is thinking about personal taxes.  Although at AIS, we no longer prepare tax returns, personal or corporate, because we are in the accounting and bookkeeping field, we are often asked for a recommendation or a referral.

Having completed tax returns for many years, I can tell you that I’ve seen everything.  Too many deductions, not enough deductions, and everything in between.

At the end of the day, you are ultimately responsible for what is filed on your tax return with CRA.  It doesn’t matter that you’ve paid someone else to prepare and file the tax return for you, ultimately, if there is a mistake, it is you that CRA will come after.  Most tax and accounting firms will even have you sign some kind of letter to that effect, basically saying that they have filed the return based on information you’ve given them.  Since this person, or firm, is representing you to CRA, you want to make sure that you’ve got the right person.

I’ve put together a quick easy list of 9 questions that you should ask your tax preparer before you hand over all of your tax slips to them:

1.  How much experience do you have? Everyone needs to start somewhere to get their experience.  I get that.  But if they are an inexperienced person, is there someone more experienced working with them that will review the return before it is filed? Do make sure that the second person has at least 5 years of experience.

2.  Do you take tax update courses? The tax world is constantly changing and evolving from one year to the next.  To ensure that they are filing the return correctly, you want to know that their knowledge is current.

3.  Do you have an office all year round?  There are lots of people who are in the tax preparation business for the April money grab.  But what happens in 3 months when CRA is calling you with a question and they’ve packed up their temporary shop until next April? 

4.  What if CRA calls me with a question? With tax returns being filed electronically as the norm, it is much more typical that CRA will send a request for supporting documentation of a single line on your return.  Unless you know exactly what has been filed, or you can ask the person who filed it, how will you know for sure.

5.  Do you give me a copy of my tax return and the supporting schedules? Regardless of whether your tax preparer has a temporary or permanent office, you should always be given a complete copy of the tax return that has been filed with CRA. Over the years, I’ve seen lots of people come in with a single summary page of their previous years return and that is all that they were given.  Make sure you get a COMPLETE copy of your return.

6.  Do they do any tax planning?  By the time you are sitting down with them this year, it’s too late to do anything about your tax bill.  But they should be discussing with you possible options to reduce your tax bill next year.

7.  Do you need my Web Access Code? This is actually a fairly tricky question.  CRA sends individuals a Web Access Code which allows us as individuals to file our returns electronically  – for example, if we were to buy Turbo Tax and do it ourselves.  Firms that prepare tax returns should not be using this code, given to you, to e-file your return.  They should have an e-file access code given to them, by CRA to file returns.  There is a bit of a screening process for this to happen, and it does add an extra level of comfort for you.

8.  Do you have any specialties?  This is important for you to know if you have a specific need or expertise on your return.  For example, if you are a sole proprietor, you want to ensure that you have someone who is familiar with the schedules that need to be filed for your situation.

9.  Do you have a guarantee?  Most good tax preparers will stand behind their work.  Even if there is a guarantee and you never use it, at least you know that the person or firm is willing to stand behind their work.

Having been out of the tax prep business for the last several years, I must tell you how much I now love April Smiley Face  But seriously, don’t take the decision lightly as to who you choose to hire to prepare your tax return.  With you being ultimately responsible,  you want to make sure that it is all above board.  CRA will let you know if you missed some income that you haven’t claimed on your return, but they won’t tell you that you could have paid less tax if you had made the following deductions Smiley It may seem like a lot of questions, but most of them are pretty simple answers for the right person.

If you have any questions that you think I’ve missed and would help others pick the right person, please feel free to share.

Copyright: ximagination / 123RF Stock Photo

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Juliet Aurora

About the Author:

Juliet Aurora is the President and CEO of AIS Solutions. She has been in the Accounting and Finance space for more years than she will ever admit. When she isn’t acting as the Sensei for her team of Bookkeeper Kninjas, you will find her working tirelessly to advocate the accreditation of bookkeeping in Canada. Her vision is for AIS Solutions to become the standard against which all other bookkeepers and bookkeeping firms are measured. Juliet can be contacted by email or by calling 1 888 575 5385.

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