Cutting out the noise

Accountants and lawyers often find themselves providing advice in the context of client issues surrounded in red tape, and will often ask, ‘how do I cut through this noise and focus on what really matters?’. The first step in doing so, is taking a more integrated approach to tackling business challenges and viewing a client’s tax, financial and legal issues holistically. This approach promotes better thinking, increases client satisfaction, and eliminates unnecessary noise. This article will explain how exactly to achieve this and encourage collaboration between accountants and lawyers, to ensure that you can offer truly holistic advice tailored to your clients' needs.

Managing Business Risks

When asked ‘what makes a good lawyer/accountant’ my first instinct is to say, one that can appropriately manage business risks. The ability to distinguish between a genuinely risky decision and one that is less serious is very important. Moreso, because taking an over-zealous approach when mitigating risks can undermine the effectiveness of your advice, leading to unnecessary complications.

Imagine this scenario: a client realises that an employee on probation just isn’t delivering what’s needed in the role, and doesn’t have the potential to make the grade even if managed and mentored closely. A rigid approach would dictate following the ACAS Code of Practice on Disciplinary and Grievance procedures from Day One. But does this truly benefit either party if the fit is clearly never going to work. A disciplinary process can be highly uncomfortable for the individual under the spotlight and might only prolong the agony.

Far better to recommend a pragmatic solution: terminate the contract, pay what the employee is entitled to, and tell them they don’t need to work their notice, giving them time to find a job that suits them perfectly. If the client communicates this skillfully, showing respect for the individual and explaining it’s just the skills fit that’s wrong, often employees see themselves that they’d be better off elsewhere and accept the decision. The employee in our example has been with the company for less than two years, so can’t claim unfair dismissal, unless there’s a discrimination or whistleblowing element, which significantly reduces the risk. A knowledgeable adviser can help clients navigate this process ethically and legally, ensuring a resolution that benefits both the business and the employee.

Professionals that know their clients’ sectors well can add significant value in helping them assess risks proportionately. And a joined-up approach between accountants and lawyers offers even more.

Asking the Right Questions

Tackling the root of a client’s problem, rather than just offering a temporary fix and taking instructions at face value, separates the best professional advisers from the so-so. The key here is asking questions and challenging briefs.

Imagine this: an overseas client requests quick help with a visa and a new contract for an employee relocating from Canada to the UK. Rather than taking the instruction at face value, a wise advisor asks about the role, why the move, how it fits in to the plans for the business and how long it will be for.

The move is to be for less than two years, which triggers an opportunity that, working together, the accountants and lawyers spot: instead of terminating the contract in Canada and starting a new one in the UK, as instructed, the advisers suggest setting up an economy agreement to run alongside the existing employment contract.

This approach invokes Detached Duty Relief, allowing the employee to cover living expenses on a tax-free basis.

As a result, the business offers a remuneration package of consisting of a a £60k base salary plus a £30k tax-free allowance, instead of a fully taxed remuneration package at £90k - reducing the company’s National Insurance contributions while increasing the employee's take-home pay.

To conclude, by understanding your clients' sectors, avoiding over-compliance, and asking the right questions, professionals can cut through the noise and focus on what truly matters. An approach that brings your lawyer and accountant together, will ensure better thinking, more client satisfaction, and will help you give better business advice.

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