>Should you hire an accountant to do your taxes?

When it comes to doing your taxes, one question that most people have asked themselves at some point is, “Should I do my own taxes or hire an accountant?” When I first started filing tax returns they were very basic and I used to do them myself. However once I started working full time, investing and undertaking further education I started using an accountant to file my taxes. They make life much easier and unlike in most countries (e.g. the USA) your accountant fees are tax deductible. If you are in the higher tax brackets, that’s like getting a 40% discount. However you need to weigh up your own situation to determine the best and most cost-effective way to prepare your taxes.

So how do I know if need an accountant? The more complicated your taxes are, the more likely it is you need a tax professional. The easiest way to determine this is to first try to do your taxes on your own. If you find it’s too difficult, or if you feel like you’re making mistakes, seek out an accountant or a tax preparation company.

Though I did my own taxes for a long time, I gave up once they became complicated and too much work. My brother referred me to his friend (whom I knew as well) who was an excellent CPA, and am pleased to pay him to do my taxes for me. Living overseas, this is an added benefit as he is able to greatly assist with my family’s local taxation affairs and has provided sound advice on a number of occasions.

From my experience — and this may not be true for everyone — having an accountant prepare my taxes has paid for itself. Though I’m a relatively smart guy and follow directions well, there are things I miss when I do them myself. Further, the tax code is updated every year and most of us non-accountants don’t have the time or background to keep up with all the changes and possible deductions. Accountants normally have tax preparation software and tax checklists that enable them to file taxes quicker, with much fewer errors and to try and get back as much as legally possible for you. For example, did you know you can claim the fuel /driving costs to and from training classes/courses you go to using your own car? For multiple days or year long programs that can add up to hundreds of dollars in deductions most of us wouldn’t know about if doing taxes on our own.

A good accountant will do more than just file your taxes, they will actually save you taxes and provide sound tax related advice. The other thing is to always choose a qualified accountant you are comfortable with, trust and has good referrals. I’ll write another post shortly with more details on how to find and select a good accountant.

Related articles:
1. Ten useful tax deductions
2. Investment Property and taxes
3. Ten Tips for Using Your Tax Refund
4. Guide to Choosing the Right Financial Planner