Tax accountant complete career guide

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Is tax accountancy a good career? 

As implied by the name, tax accountancy is a form of accountancy which focuses on helping people with their taxes. It requires a solid understanding of tax legislation for individuals and businesses. Tax accountancy is designed to help clients manage their taxes, allowing them to save money and achieve their financial goals whilst also abiding by the law. 

Tax accountancy is an excellent career path for people with an affinity for mathematics and analytics. It involves working with a diverse range of clients, so those with strong communication skills would thrive in this role. The industry is constantly evolving and consistently challenging, too. If you like to feel a sense of progression, then a job in tax accountancy is worth considering. 

What sort of jobs do tax accountants undertake?  

Some become in-house tax accountants, which means they are solely employed by one company. Others are employed by tax accountancy firms who complete work for a variety of clients, or they become freelance advisors. Meanwhile, tax accountants that are interested in the regulatory side of things can join auditing boards. 

The more experience you accrue in the tax accountancy industry, the further you can progress up the career ladder. From here, more senior positions with better salaries become available to you. Most large organizations need tax accountants, including governmental branches, investment firms, charities, and commercial businesses. 

The average salary of a tax accountant 

The salary of a tax accountant depends on their education and experience. The 2021 average annual salary for a professional in the field is $58,000, with salaries ranging between $52,000 and $64,000. Entry-level tax accountants can expect to be on the lower end of this percentile and see their salary increase with each passing year. Meanwhile, tax accountants with 20+ years of experience usually find themselves in the upper percentile. 

Tax accountants with senior roles usually earn a higher salary than the average. For example, accounting managers and senior tax accountants receive roughly $70,000 annually. The highest earners in the field are tax managers. Their salaries can range anywhere from $94,000 to $163,000. They are highly experienced in the industry and have usually obtained a master’s degree in accounting or finance alongside their bachelor’s degree. 

What are the requirements or qualifications for tax accountants? 

If you wish to become a tax accountant, you will need to earn a bachelor’s degree in finance or accounting. The course you choose should ideally have modules which focus on tax law. Certain employers might also ask for a master’s degree in taxation, financial planning, or another related subject. 

Aspiring tax consultants can improve their job prospects by undertaking additional qualifications. For instance, you could take an exam to become a certified public accountant (CPA) or complete a short course in economics. Applying for internships at tax accounting firms is also a brilliant way to infiltrate the industry. 

To become a tax accountant, you will also need excellent analytical and communication skills. It is essential to pay attention to detail, as small mistakes can have big consequences. Background knowledge of mathematics, computer software, business, and government regulation is helpful, too. But most importantly, tax accountants must be confident in tax preparation and law compliance. 

How to become a tax accountant

Are you now thinking about becoming a tax accountant? That is great, but be aware that there are several steps you will need to take before you can secure a job. As is the case with most professions, the process of becoming a tax accountant will be time-consuming but worthwhile. What follows  is a breakdown of the journey to help make things a little clearer. 

First and foremost, an aspiring tax accountant needs to acquire a bachelor’s degree in accounting or finance. To earn this qualification, you will need to complete a program with an accredited university. Find an institution that offers a bachelor’s degree in accounting or finances. Be sure to check their prospectus to see if their modules will provide you with the skills and knowledge you need to become a tax accountant. For example, the program should ideally have a module on financial planning. After reviewing universities, apply to a range that meets your requirements. 

After being accepted by a university, you will then begin your bachelor’s degree in accounting or finance. These programs usually take 3 to 5 years to complete, depending on the university, student, and whether the degree is part-time. Most universities now offer online classes to their students, along with physical lectures. Make sure to check out the options available to you and find the program that would best suit your lifestyle. 

If you are hoping to become a qualified tax accountant, you will be pleased to know that there are also online accounting courses available. Remote learning is a convenient and cost-effective option, helping people to advance their careers without having to pay for additional expenses like accommodation and travel. As online courses are much more flexible, it is easier to fit your education around your daily life. 

Once you have earned your bachelor’s degree in accounting or finance, you can begin looking at entry-level jobs for tax accountants. However, some people also consider completing a master’s degree to improve their job prospects. There are programs in taxation and accounting that can better equip you for this vocation. The more qualified you are, the better. Some employers won’t accept aspiring tax accountants without a master’s degree and higher-paying positions might also not be available to you. 

To build your knowledge and experience in the field of tax accounting, you might also want to obtain further qualifications. As we mentioned before, this could include taking an exam to become a certified public accountant. Completing a short course in a subject related to the field could be helpful, too. Bookkeeping or economics, for instance, would be very beneficial. 

All these qualifications will better equip you for a role in tax accounting. But what about gaining professional experience? Applying for internships at accounting firms is a good idea. Internships can provide you with an entry-point into the industry, whilst building your confidence and developing your practical skills. Postgraduates can also look and apply for entry-level jobs in tax accounting, advancing their career from there.

What are the duties of a tax accountant? 

A tax accountant has several roles and responsibilities which can change depending on their client. They usually work for public or private businesses, the government, non-profit organizations like charities, or specific individuals. Most of the time, they work the standard full-time hours. These hours tend to extend during the taxation season, as their workload increases. Here are the main duties of the standard tax accountant. 

Manage finances

A tax accountant will organize their client’s financial records for them. This includes creating a coherent filing system that contains all the most recent and relevant tax documentation which the client can easily access whenever they need information. 

Prepare taxes

One of the main responsibilities of a tax accountant is to help their client prepare their tax return documents. They will examine all of the client’s financial statements, making sure that they comply with the government’s laws. A tax accountant must also ensure there has been no overpaying or underpaying and that their client isn’t being taxed for the wrong things. 

Help budget

A tax accountant will also help their client to budget or develop financial strategies to improve their profitability overall. They usually analyze financial statements to identify where overspending occurs and then create reports to suggest changes. They will also inform the client whenever their financial situation has changed their taxation. 

Input taxes

People usually hire a tax accountant because they don’t understand how taxes work themselves. As such, in this profession, you are expected to take complete charge of the client’s taxes. This includes preparing their tax return, making sure they meet the tax deadlines and informing them whenever they owe, or are owed, money. O

Communication

Taxes can be intimidating and perplexing. Tax accountants must be able to soothe the client’s worries and resolve any confusion they might have around their taxes. As such, part of the job description is good communication. They need to provide information clearly and promptly, ensuring the client knows what to expect from their tax return. 

Inspect systems

Usually, tax accountants will inspect their client’s existing system for accounting to ensure that everything is functional and efficient. They will also alter the system whenever the tax legislation changes or technological updates become available. 

Can a tax accountant work from home?  

Tax accountants can work from home as they are able to contact their clients via email and phone. As such, they are not limited by location – they can have a wide variety of customers from across the country, increasing their job prospects. With the business landscape shifting further towards remote working, tax accountants can feel secure in their position. 

American Accounting Association (AAA) 

Established more than a century ago, the AAA gathers under one roof an extensive community of accountants from all walks of life, including the academic field.  

National Society of Accountants (NSA)

With a core mission of helping tax and accounting professionals further their knowledge, NSA is a society that has been active for 75 years.  

National Association of State Boards of Accountancy (NASBA) 

Established in 1908, NASBA acts like a forum for the 55 State Boards of Accountancy in the US, which administer the Uniform CPA Examination. In partnership with AICPA, NASBA facilitates CPA examination for professionals overseas.

Financial Accounting Standards Board (FASB) 

Founded in Norwalk, Connecticut, in 1973, FASB is an independent organization that sets the standards for public and private organizations following Generally Accepted Accounting Principles (GAAP) in the field of financial accounting.