Not too taxing: Consultants survive the recession and look to benefit from resulting changes
London, United Kingdom (PRWEB) July 05, 2013
The Tax Consultants industry provides income tax return services to personal and business clients and offers advice on tax-related business issues. Business income tax services are estimated to account for just under half of the industry, tax advisory services constitute a further 35% and personal income tax services account for the final 17%. The industry is expected to record relatively slow revenue growth during the five years to 2013-14, expanding at a compound annual rate of 1.7% to reach £4.4 billion. This has mainly resulted from falling demand for the industry's tax advisory services following the financial crisis and the subsequent uncertain economic climate.
According to IBISWorld industry analyst Andrew Johnson, “Tax advisory services are the most volatile industry segment and demand for these services is closely linked to the overall state of the economy and has declined sharply during the past five years, due to the recession and the reduction in corporate transactions that require tax-related advice.” However, the industry's tax return service segment has proven relatively stable during the recession as private and corporate clients are required to file tax returns regardless of the state of the wider economy. This has helped stabilise the industry in a difficult period. The industry is expected to grow by 1.1% over 2013-14, but revenue growth will be limited by subdued business expenditure.
The industry is expected to gradually return to more solid growth over the next five years through 2018-19 as business confidence and expenditure is anticipated to strengthen. Johnson adds, “Growth will be driven by continuing demand for tax returns, a gradual recovery in business demand for tax advisory services and changes to taxation regulations.” Measure to reduce illegal tax avoidance are likely to trigger a rise in demand for consultancy services as individuals and businesses seek alternative tax planning services. The European Commission's proposed audit reform is may also indirectly affect the Tax Consultants industry by possibly limiting the services provided by major industry players.
The Tax Consultants industry has a medium level of market share concentration, with the four largest firms – PricewaterhouseCoopers, Deloitte, Ernst & Young and KPMG – accounting for 48.5% of industry revenue. The Big Four accounting firms are dominant in providing tax advisory services to large clients, particularly publicly listed companies. Although the top four firms hold strong market share and dominate the tax advisory segment, there is a large number of small firms offering tax return preparation services to private individuals and small businesses throughout the United Kingdom. The majority of these firms operate as a sole proprietor or with few employees and focus on one particular geographic region to cater to the needs of local businesses or individuals.
For more information on the Tax Consultants industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.
IBISWorld industry Report Key Topics
Firms in the Tax Consultants industry prepare personal and business income tax returns and offer tax advisory services and non-legal representation before tax authorities. However, industry operators are not responsible for offering comprehensive management consultancy services like accounting services or the provision of budgetary control procedures.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalisation & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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