What Is a Tax Advisor? Duties, Pay, and How to Become One

Tax advisors, also known as tax consultants or tax preparers, offer various tax consulting services to individuals and businesses. They may prepare tax returns, estimate taxes owed, and represent clients at audits. As a professional tax advisor, you will help people understand the tax laws and regulations that impact their finances.

If you have a knack for problem-solving and enjoy working with numbers, then consider a career as a tax advisor. In this guide, you'll learn more about tax advisors, what they do, and how much they earn in Canada.

What is a tax advisor?

While looking at tax advisor jobs, you’ll often see the role referred to as tax consultant, tax advisor, or tax preparer. You’d offer tax advice in several roles, including a Chartered Professional Accountant (CPA), tax attorney, and an enrolled agent.

As a tax advisor, you help businesses and individuals navigate the complex world of taxation. You minimize tax liabilities by using tax laws and effective planning. This role can vary and may often encompass accounting, auditing, finance, and tax law elements. 

To become a tax advisor, you must have strong numeracy skills and be able to interpret complex data. However, the competencies you require for this job are more than just technical and accountancy-based. The role also requires good communication skills and building relationships with your clients.

Read more: How to Become a Tax Preparer: Your 2023 Guide

What does a tax advisor do?

As a tax advisor, you strive to be an expert in taxation. Your job is to help clients by helping them legally decrease their taxable income or increase their tax refunds. You may advise clients on dealing with audits, unpaid taxes, and other issues with the Canada Revenue Agency (CRA) or provincial or territorial tax authority.

Your primary role is to ensure your clients are not paying more in taxes than they need based on their income level, investments, family situation, and other factors. Your role may include:

• Researching tax issues and ensuring your clients are tax-compliant

• Preparing and reviewing tax returns, corporate and personal income taxes, sales and use tax, property tax, franchise tax, and estimated taxes

• Advising and consulting on taxation issues

• Representing clients before the CRA if you are a CPA, attorney, or an enrolled agent

• Reviewing proposed legislation that would affect clients' taxes

Average tax advisor salary

According to Glassdoor, tax advisors in Canada earn an average annual salary of $74,140 per year [1]. However, earnings depend on years of experience, specialization, sector worked in, and location.

Where do tax advisors work?

Some tax advisors work alone with clients as freelance consultants, while others work in large teams of tax professionals at accounting firms. You can work in different organizations after you become a certified tax advisor.

Many tax advisors concentrate on specific areas of taxation, such as real estate, international, or business tax. As a certified tax advisor, you may work for the following types of firms:

• Professional tax preparation companies

• Corporations

• Public accounting firms

• Legal companies

• Government agencies

• Non-profit organizations

How to become a tax advisor

While the specifics will vary based on your background and personal journey, here are the primary steps you'll likely need to take to become a tax advisor

1. Consider a degree.

While a college degree is not necessarily required to become a tax advisor, you’ll find different degree options when considering this career path. The one you decide to study will depend on your goals and the time you want to invest. Some degree options include: 

• Associate degree: An associate degree programme in accounting, finance, or a related field can help you learn how to analyze financial data and the details of business law and accounting regulations. Similarly, you could complete a diploma or certificate program.

• Bachelor's degree: Employers may prefer tax advisors with at least a bachelor's degree. Consider a bachelor's degree in accounting, business, finance, business tax, business administration, or related fields.

• Master's degree: Master's degree programs expose you to more complex tax issues, like international taxation. This degree can help you specialize in a specific area of taxation advice. Degrees to consider include a Master of Laws in Taxation (LLMT), a Master in Taxation, and a Master of Business Administration (MBA). 

Online master's programs

Suppose you want to gain a master's degree but require a cost-effective, flexible program that fits your life. The University of Illinois Urbana-Champaign's Online Master's of Accounting (iMSA) might be right for you.

2. Gain the right skills.

To become a tax advisor, you must have a strong knowledge of tax and accounting principles and be comfortable working with numbers. You will also need excellent communication skills to explain complex tax matters to clients. The following is a list of additional skills to build to be an effective tax advisor:

• Mathematical ability: As a tax advisor, you'll use strong numerical reasoning abilities. You must be able to analyze financial information to identify errors or problems. 

• Attention to detail and accuracy: You'll need to pay attention to detail since mistakes can be costly for clients.

• Strategic thinking and problem-solving skills: You will be looking at clients' financial data and using strategic thinking skills to identify ways clients can save money or increase profits. You will use your problem-solving skills to find solutions for clients.

• Computer and software skills: You need knowledge of various accounting-related software programs, including spreadsheets, databases, and accounting and taxation software. Software often used in tax work includes QuickBooks, Peachtree, Sage 50, ProSeries, Drake Tax, ATX Tax, and Lacerte.

• Verbal communication: Taxes can be complex and convoluted. Effective communication skills are essential when discussing delicate financial matters with clients.

• Dedication to continued learning: To stay registered and up-to-date, you must complete continuing education courses each year.

3. Get relevant work experience. 

Work experience in a related field can help you prepare to be a tax advisor. This includes experience as an accountant, auditor, financial assistant, financial examiner, or finance professional. You can also gain the necessary experience by working as an intern.

4. Consider credentials. 

Several credentials can increase your chances of getting work as a tax advisor. CPA credentials are one such example. You don’t need to take the CPA examination to work as a tax advisor, but passing the exam demonstrates your knowledge of the necessary technical skills some employers prefer or require. Two credentials to consider include enrolled agent and Chartered Professional Accountant:

• Enrolled Agent (EA): The Canada Revenue Agency (CRA) issue Enrolled Agent (EA) certificates. It allows an EA to represent taxpayers before the IRS or ERA. CPAs and attorneys can also represent their clients at CRA meetings.

• Chartered Professional Accountant (CPA): Being a CPA can give you additional credibility due to the training involved. To become a CPA, you must have a bachelor's degree in accounting or a similar field, register for and complete the Professional Education Program (PEP), complete a capstone/period of practical experience, and pass the Common Final Examination (CFE). Canadian CPAs have a pathway to obtaining a US CPA credential as well.

5. Apply for licensure if required. 

To be a CPA, you need to get licensed in your province or territory. The exact requirements vary at the national, provincial, and regional levels. Not all tax advisors are CPAs, but if you take this route, you should apply for and obtain your CPA license.

6. Join a professional organization.

Joining professional tax bodies can help enhance your resume and profile. In addition to providing various professional training and continuing education opportunities, professional organizations also host online and live networking events and conferences that can assist you with your professional development.

Some professional organizations you may consider joining include:

• Association of Tax & Accounting Professionals

• Charted Professional Accountants of Canada

• The Chartered Tax Practitioner and Certified Public Finance Accountants of Canada

7. Continue your education and training. 

You must complete continuing education courses throughout your career to maintain your CPA, licensure, and EA certifications. You should also keep your tax advisor skills current by taking relevant courses and other learning opportunities.

Typical career paths 

The tax advisor’s career path depends on their goals. People often enter the field from jobs in accounting, the CRA, office management, customer service, and administration. You may move into related roles during your career, such as tax accountant or tax analyst. A possible career path for a tax advisor could look like the following:

• You apply for and complete an internship with an accounting firm or take a junior role.

• After three to five years as a tax advisor, you can be promoted to a senior tax advisor, perhaps even leading a team. If you’ve passed the CPA exam, this may be just one to three years. 

• You can expect to reach a managerial role after five to eight years as a senior tax adviser.

You may remain a tax manager or director until retirement or move between firms in senior roles. You could also enter general accounting, finance management, or controller jobs.

Start your tax advisor journey.

Tax advisors have the knowledge, skills, and expertise required to help others maneuver the complexities of the tax system. If you're interested in joining the profession, consider taking a cost-effective, flexible specialization through Coursera to gain the job-relevant skills you need to excel. In Wharton's Introduction to Finance and Accounting Specialization, you'll learn the basics of accounting and finance to build a foundation of core skills on your path to becoming a tax advisor.

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