A taxing task lies in store for millions: Many people seek professional help with tax returns. Neasa MacErlean describes some services on offer

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The Independent Online
EIGHT million people have just begun the annual ritual of the tax return. Despite the efforts of the Inland Revenue to be helpful - it has designed a special purple return for the clergy, for instance - it will be a complicated and painful process for most of us, the financial equivalent of a protracted course of dental treatment.

More than two million people are expected this year to consult accountants, the main providers of tax advice. But even for them the experience is frequently an unhappy one.

'Often you find that the client comes in with their knees knocking,' said Kerstin Meeson-Smith, a sole practitioner in Cambridge. She believes that many taxpayers are too nervous of their accountants to tell them everything they need to know. 'The person really needs to like their accountant,' she adds.

But times are changing. In the past the personal taxpayer was often regarded as a second-class citizen by accountancy firms. They had very little power to negotiate fees, for instance. Nowadays, in the wake of the recession, many firms are desperate for business. Most will give fee estimates up front and many are pitching very aggressively in terms of price.

Levy Gee, for example, a large London firm, is launching TaxPro, a pounds 199 tax return service for employees who need to send in tax returns. The firm admits it is 'a little bit of a loss leader' - but one that it hopes will encourage clients who may one day have other potentially interesting business.

The service is generally only available for groups of at least four employees in the same company. This way Levy Gee can achieve some economies of scale to set against the low fees. Everything is dealt with by post.

Like Levy Gee, the west London accountants Vandenburghs are relying on technology to bring dramatic price reductions to the market. Next month Vandenburghs plans to unveil a computer programme, Fiscus, that will produce tax returns - albeit relatively simple ones - for a cost to the taxpayer of pounds 49.99.

Vandenburghs will offer the service to callers at its offices in Latimer Road, but it is also in negotiations with the largest building societies and high street banks to provide an over-the-counter service in their branches.

Fiscus, which has been developed over the past year, will produce a tax return, a schedule of taxes due and a letter of basic advice for each individual whose details are fed in. The simplest returns can be produced in about 15 minutes. But the system can cope with the self-employed, share transactions, property rental and bank accounts in Jersey, for example.

The programme's designer, Nigel Cohen, believes the product has mass appeal. 'About 70 or 80 per cent of the assessments we see from the Inland Revenue are wrong in one respect or another,' he said. 'The concept we have in mind is people whose tax saving exceeds the cost of the tax return. Many don't claim their allowances.'

For people who want to use an accountant, the Institute of Chartered Accountants in England & Wales - based in London - will give telephone inquirers the number of their local district society of accountants. The district societies will, in turn, give out telephone numbers of local firms. They will also advise on dealing with accountants and some of them encourage potential clients to try to get an estimate of fees up front.

Negotiations and comparisons are usually well worth the effort. London-based Casson Beckman says that the average fee for a tax return is about pounds 500. But for four or more employees of the same business it could cut the rates by up to 40 per cent.

This month the Revenue has sent out 8 million returns which it wants completed by the end of October at the latest. 'If there are any problems people should talk to their tax offices,' said a spokeswoman.

(Photograph omitted)

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