Tax can be a complicated endeavor for anyone who doesn’t understand the accounting or what it entails. It is also not something you can delay or get out from and that means you need to do your taxes regularly in order to avoid penalties. This is why people use outside help and rely on expertise from the individuals or companies to file their taxes.
However, technological advancement brought another solution for this issue. Today, instead of hiring a certified accountant, you can use tax-preparation software to get it all done. But both options have their advantages, so here is the comparison to answer which one is better.
Pros of tax software
Speed
Without a doubt, it will take you less time to calculate and complete your taxes than by hiring an accountant. This is because all it takes is to collect the documents and start preparing your taxes by entering data into the software. On the other hand, the accountant will take more time since you may not be their only client, but also they will need time to file your forms.
Price
Price is something that is undoubtedly going to affect your decision on which type of tax preparation to choose. The cost of software can on average amount to $50 which can be on the annual level, or for good with a small additional and optional fee for support. However, there are many free options out there which are sufficient enough for individuals and small businesses.
On the other hand, the accountant will cost you more and you will have to pay them by tax filings. This means that whenever you have to prepare and file your taxes you will have to hire them all over again. So, the notion you can save money on tax preparation is the most attractive benefit of using software to do it.
Simplicity
First of all, you need to research the tax preparation software to see if you agree with its methods. Some programs can be confusing especially for people who don’t have experience in filing taxes. Look for the user-friendly interface and options that will explain each step.
If you have only a few things to prepare, then the software will be perfect and the best solution for you. A good program will walk you through the process of making it all easy and less burdening. Some developers even offer free training for their customers as part of the price, so that is also something to consider.
Pros of hiring an accountant
Human touch
Nothing beats human touch, no matter how simpler it may seem. Your accountant will know your financial situation and work in your best interest to overcome any problems and reach future goals. Suggestions and recommendations don’t come from software and sometimes that is exactly what you need to resolve certain issues.
Around the clock service
Not only will your accountant answer all your questions, but they will be available to give advice or take care of problems around the clock. This is especially important if you branched out your business to other countries and need to respect different regulations you barely know anything about.
For example, on Australian market consulting the best accountants in Sydney will help you when opening a branch office in other parts of the world. Your accountant will know which papers to prepare for the tax filing in other countries, as well as what to do at the headquarters.
Handling of complicated cases
Software can’t help with complicated cases since you will need immediate reaction and advice on what to do. That is where an accountant will save the day since some matters can be really sensitive and need expert handling. Take into consideration that a professional tax preparer knows the system and can quickly react to any problem which may arise.
The software is impersonal and hardly can predict any unexpected situations which can only cause more trouble especially if you are not familiar with the tax regulations yourself.
Relieves the workload
Tax preparation is a serious obligation you need to handle in time. This is especially hard if you are busy and have other tasks on your agenda. Using even the best software there is will require time and collection of all the necessary data for the submission of forms.
Hiring an accountant will take that workload of your schedule so that you can focus on more important things like running a company.
In the end
Choose between tax software and an accountant in the rational and realistic way. Take into consideration what you need to include in your taxes and whether you will need around the clock support. If you are an individual, then the software may be a perfect solution for you and the most cost-effective one.
However, as a business entity, consider hiring a professional who will not only prepare your taxes but also give you valuable advice and recommendations. After all, sometimes you will need to know more about certain matters and software can’t educate or instruct you on the right approach.
