In a recent episode of The Concierge CPA Podcast, Jackie Meyer, CPA, founder of TaxPlanIQ, welcomed Divakar Vijayasarathy, founder and CEO of DVS Advisory Group, for an insightful discussion on accounting firm growth and scaling globally. Drawing from his vast experience across four countries and multiple industries, Divakar shared transformative strategies to help CPAs and tax professionals break through growth barriers, embrace innovation, and adapt to the evolving challenges of the profession. Here’s a closer look at their conversation and the key takeaways for forward-thinking accounting firm owners.
You can listen to the full episode here, or on your favorite podcast platform.
Dr. Jackie Meyer, CPA (00:00):
This episode of The Concierge CPA is brought to you by Vistia. They have some amazing tax strategies and alternative investments for high net wealth. And anyone that really has 25,000 or more to invest, I highly recommend reaching out to them and seeing what they can do for your clientele. So as we kick off the new year, I wanted to add a new little section to the concierge CPA podcast around my upcoming book, which will release fall of 2025, working title balance sheet of life overcoming the BS for Entrepreneurs. So, let's talk about balance. Everyone thinks is balance really bs well, it's not necessarily this like unicorn that we don't know how to grasp out there. There are ways to actually make it practical, and that's what my book is all about. It's measuring 10 different asset categories to improve your life, determine smart goals around things that you ultimately really wanna improve when you're measuring zero to 10 out of those categories.
Dr. Jackie Meyer, CPA (01:05):
And so I'll be providing some short snippets to you with every podcast that goes through that balance sheet. I get it. Between chasing goals, chasing kids the ultimate goal of balance feels like a very far away dream. So to get more details, please go to my LinkedIn profile, Jackie Meyer, CPA, and hit subscribe to my Balance Sheet of Life newsletter. And you'll get all the latest updates of my upcoming book. Comment with what you wanna hear about. What do you care about is passion, important, purpose, profit. Those are the trifecta of American success. But there's seven more categories that we'll actually be deep diving into that I think you'll really enjoy as well. Take care. Welcome to The Concierge CPA. I'm Jackie Meyer, founder of the Concierge Accountant Program and TaxPlanIQ software. This is a podcast for accounting firm owners and influencers who are pursuing world class service. We discuss their path to excellence, their daily habits, and what influences them and their work. We believe that every person has a unique message that can positively impact the world. Stick around. Till the end of the show, we'll reveal how you can be our next guest. Let's go. Y'all.
Dr. Jackie Meyer, CPA (02:31):
Welcome to The Concierge CPA Podcast. I'm your host, Dr. Jackie Meyer, CPA. I have a new friend, DJ, VJ on <laugh>? No, not DJ. VJ Diva. VJ <laugh>. Wow. <laugh>. Okay. It's and you can give everyone your full name, but Okay. You've been so kind to let me nickname you and use, you know, what some of your friends do. But you are the CEO and Founder of DVS Advisory Group. Welcome. Glad to have you. You've written a billion books and you've got a lot of knowledge it sounds like. So I'm excited to have you today.
Divakar Vijayasarathy (03:11):
Oh, thanks Jackie, for having me around. And yes, for all those of you, my name is Divakar Vijayasarathy. It's a Sanskrit name. And my American friends call me Diva VJ. That that makes, since that's...
Dr. Jackie Meyer, CPA (03:25):
A pretty good name. Yes.
Divakar Vijayasarathy (03:26):
Look, look forward, Jackie. Look forward to engaging with you.
Dr. Jackie Meyer, CPA (03:30):
For sure. So tell us a little bit about your background and, you know, where are you at today?
Divakar Vijayasarathy (03:35):
Okay, so I, I was born and raised in the southern part of India in a city called Chennai. And yes, literally amongst slums when I started my life. And I was an accountant in India. I was an all India rank holder. And, and if you were to understand the accounting profession in India those days, it was brutal. We used to have a qualifying percentile of 0.3 percentage of people who would pass the exams.
Dr. Jackie Meyer, CPA (04:03):
No way.
Divakar Vijayasarathy (04:04):
Yes. <laugh> When, when my brother cleared, it was, it used to be 0.15, 0.2. And from there, now it's moved on to late early to mid twenties. That's the, it, it used to be brutal. And I qualified I got my employment with some of the top names. Citibank was my last employer. I worked in about four places in for two, two and a half years. But employment was stifling. I wanted to get out and do something on my own. So that's why I quit in 2007 and started DVS at that time. Wow. My focus was on international tax because a world of tax at least I viewed it as a, a fiscal is, is is a behavioral science subject and not a fiscal law. And that perspective took us long and far. And today, here we are. We are, we are, we are in four countries now, India, the Dubai, Singapore, and the US where I'm currently I've relocated to and we have our office in New York.
Dr. Jackie Meyer, CPA (05:03):
Awesome. And
Divakar Vijayasarathy (05:05):
And yes, I mean, we've got eight different practices 200 plus people across multiple domains and at least more than a couple of hundred million dollars in revenue. So that's who we are at this point.
Dr. Jackie Meyer, CPA (05:21):
Awesome. Wow. Lot to unpack there. So how often do you make it over to your New York office?
Divakar Vijayasarathy (05:29):
Okay, so I live out of Greenwich, so at least go there. I hope, I hope to go there at least two to three days a week because Nice.
Divakar Vijayasarathy (05:38):
I got to that office because I wanted to be in that road. Where I was young. I was reading bill Ackerman's journey and how he named this fund, Pershing Square. 'cause He was able to see Pershing Square from his window. So when I moved, when I wanted to set up an office, I went to Pershing Square and saw all the buildings from where I could see that place and chose my office accordingly.
Dr. Jackie Meyer, CPA (06:01):
Wow.
Divakar Vijayasarathy (06:02):
So I go there for inspiration whenever I'm a bit I just wanted it, wanted it.
Dr. Jackie Meyer, CPA (06:06):
Yeah. That's awesome. So I haven't, I don't think, I didn't make it in 2024 to New York City. I try to go at least once a year. I'm down in Texas and I'm a native Texan. Okay. So I try to travel as much as possible. But yeah, maybe, maybe I can come visit you in 2025 because I love New York at least once a year. <Laugh>
Dr. Jackie Meyer, CPA (06:27):
<Laugh>
Dr. Jackie Meyer, CPA (06:28):
Not maybe more than that, but <laugh>. Yeah. So I'm jealous. That's amazing. So, I mean, you started with you said essentially like in the slums. How did you turn your life around? I mean, what would you, what would you credit that to? Is it grit? Is it perseverance? Is it smart? You know, what helped you get out of that situation?
Divakar Vijayasarathy (06:55):
I mean, I wouldn't use any of it. It was life circumstances. Jackie, I mean, my dad became blind when I was in my age standard. And wow.
Divakar Vijayasarathy (07:03):
I was, I was close to bankruptcy three times in my life. Okay. And I had to, I was running his business. He was an artist by profession. I'm also a trained artist, ah, in life. So that's how the connecting the dots comes naturally to us. And I, I used to run my dad's drawing school. He used to, he had a school when I was in my eighth, ninth and eighth, ninth, 10th, 11th or four years. And those were life changing moments, taught me how to run a business, what is the value of discipline. And my dad sustained the family for the next 14, 15 years until I got settled. And he used to better than, I mean, it really taught some real life lessons that I mean, you are never down or defeated until you actually give up. So, yeah, I think, I think these were the foundational moments and I wish no one gets there, but I think that puts you you know, gets you ready to face larger games in life.
Dr. Jackie Meyer, CPA (08:04):
Sure. Okay. So what I'm hearing is, is that you, your dad inspired you in a way because he kind of started the entrepreneurial journey, and then you were able to kind of kick it off from there and do your own thing. And you've had your ups and downs in life, but who doesn't as an entrepreneur? <Laugh>, I mean, exactly. Yeah. I mean, only the most brave ones talk about the almost bankruptcies or the lawsuits or, you know, whatever happens in that, like, you know, quiet space that, that is hard to discuss. But that's really, really cool. And you know, I, I grew up with a single mom teacher, didn't have a ton of money, but it's nothing like probably what you went through in India. And so I can't, it's hard to even try to like empathize with that. But I love that you kick off with that so that people understand like that, you know, you kind of rose from the ashes and now you have like a killer company or companies and anything's possible for people. Right.
Divakar Vijayasarathy (09:09):
I mean I would ideally prefer people to not empathize, but also just start looking at life as what's possible.
Dr. Jackie Meyer, CPA (09:16):
Yeah.
Divakar Vijayasarathy (09:18):
Because sympathy, at least so far in the way we look at is I feel, it, it, it's, it's ignorance. When you, these are conditionings which life has given best stored upon me. That's how I see it. I look at my kids and feel that, I mean, you guys are so unfortunate in life. You don't know what it takes to, yeah.
Dr. Jackie Meyer, CPA (09:38):
I know, right? <Laugh>.
Divakar Vijayasarathy (09:40):
Exactly. <Laugh>,
Dr. Jackie Meyer, CPA (09:43):
I worry about that too with my kids. <Laugh>
Divakar Vijayasarathy (09:45):
So seriously.
I mean but yes, I mean, life has been kind and it's just prepared for the next battle.
Dr. Jackie Meyer, CPA (09:54):
Yeah.
Divakar Vijayasarathy (09:56):
So in Sanskrit, Jackie, we use this term the word life means 'ra' it's just a flow of experiences. Hmm. Your neither the cause nor the consequence. You're just a witness to what's happening around you. And, and the moment we get to that mindset, everything just looks like a movie happening right in front of your eyes, including yourself being a player.
Dr. Jackie Meyer, CPA (10:23):
Hmm. Okay. And so how much like personal responsibility does one take when you're kind of watching a movie unfold? Like, how much is it fate versus like you taking action? I'm always really curious about that, how people feel like how much is under your control of the actions you take versus just like, what was meant to be, you know.
Divakar Vijayasarathy (10:44):
I mean, what was meant to be is something the outcome which is not in your control. What is in your control is the desire and the initiative which you can take. Yeah. Most of the times, the, the, the gap between where we are and where we want to be is a set of doubts or fears, which we have. And we break that and go for it many a times. I think in life, what I've come to realize or experience is every problem looks big from a distance. And opportunity looks small from a distance. And as we get closer to the problem, the problem diminishes and the opportunity starts to get bigger. So fate, at least in my view, is outcome is not in our consequence. Taking action is in our control. And most of the times, if you go and take action without fear, the biggest barrier in life, at least I've realized, is fear and self-doubt. And if we overcome that barrier, what's beyond that is our bliss. I mean 'cause the biggest pain in life is regret. Right. As we all, that's why we are all entrepreneurs for sure. And yeah. And then the gap between where we are and where we ought to be or where we want to be is nothing but our in initiative or effort. And, and, and faith just takes us there if we just don't have fear in the, in the route.
Dr. Jackie Meyer, CPA (12:07):
Yeah. I love that. I believe, are you on a Forbes writer on one of the Forbes councils?
Divakar Vijayasarathy (12:16):
Yes.
Dr. Jackie Meyer, CPA (12:16):
Yes. Okay, perfect. Which council are you on?
Divakar Vijayasarathy (12:20):
On the tax, international tax
Dr. Jackie Meyer, CPA (12:21):
Expertise? Oh, nice. Okay. I'm on the, oh, I just blanked. <Laugh> coaching one, I think. I dunno. But it's been really fun. But I wrote an article on courage and how courage is really doing something even with fear. So, I mean, we can't necessarily block out the fear, but if we can overcome it and have that courage, then that's what's gonna get you that much further than the next person. I have a really dumb blocker right now. Like I do, you know, we're 60 episodes into this podcast. I love interviewing other people on it, and obviously I don't care about being on video for that, but I don't like just talking to the camera video. Right. And that's what everyone says you really need to do, is to give your knowledge away. Right. So I'm setting a big goal this next year. It's such a weird fear, but I just have that fear of just like, talking to the camera and giving what I know and maybe the judgment around it. And so I'm really like surrounding myself with people that are gonna encourage me and hold me accountable to overcome that fear. So I just get going, you know?
Divakar Vijayasarathy (13:32):
Yes, yes. Lovely. I mean, you use these lovely terms, right? You use courage, you use judgment, you use fear. I think these are simple, but really deep blocks or enablers we have in our life. In, in one of our most profound principles in open, we use this concept called thema. And Thema is acceptance without judgment.
Dr. Jackie Meyer, CPA (14:03):
Wow. I love that.
Divakar Vijayasarathy (14:05):
And when you start to look at life from that prism, you actually don't worry about what others care. 'cause Many a times we, when we dig deeper, our perception of how others might judge us is a, is a reflection of how we judge others in the game. In the barking.
Dr. Jackie Meyer, CPA (14:23):
Yes. Yes. You're right.
Divakar Vijayasarathy (14:26):
So I think that's the constant. These are small, small levers, which since childhood, if it had been worked upon us, I think life would've been so different. Which Yes. Better late than ever.
Dr. Jackie Meyer, CPA (14:36):
Yeah, for sure. Okay, so none of this was really part of the questions I was gonna ask you, but we got deep, real fast and I love it. I do wanna talk a little bit about your company and exactly what you do. Who do you service? You know, what types of clients are you only working with high net wealth or international expats? Or do you help smaller accounting firms if they have a client that maybe has an international experience they need? Tell us more about that.
Divakar Vijayasarathy (15:06):
So, I mean thanks Jackie. So my journey has been filled with solving one problem for this industry, which was scale. I loved tax as a, as a subject because it was pure behavioral science. Maybe we can talk about it on a, on a different day. My next book with Forbes is entirely on that premise. Yeah.
Divakar Vijayasarathy (15:29):
Why was the accountants, why were the accountants Even today when a technology company can have tens of thousands of people, billions of dollars of revenue, you see accounting firms like half 1,000,001, two. In, in the US there are 600,000 accounting firms for 190 billion, $160 billion of revenues in the market. And it's, and people are so fragmented. So in 2012, I tried to build a platform in India, it was called meetyourpro.com, where on one platform I brought on board 2000 odd lawyers and accountants. And for the first time we made them put their prices online. Oh. And standardized scope of work. I mean, yes. You and me are accountants, right? I mean, you, you, it's so hard to get an accountant to put his or her prize published on a website. We got to do that. But the venture collapsed because we realized the accounting world suffers from three, three chronic challenges. I ran it for two years before it pushed me to my second bankruptcy. First was the ownership structure ventures, which are structured as partnerships are primarily built to share and not built to scale.
Dr. Jackie Meyer, CPA (16:41):
Ah, good. That's a very nice key, key term and key thought there. I like that.
Divakar Vijayasarathy (16:47):
As, as a partner, we are there to share, right? I mean, you share lives, you share these polls, but you don't build anything. Yeah. Was talent, an accounting firm should not be run by accountants. It should be run by professionals, entrepreneurs. Yeah. That by default. Yeah.
Dr. Jackie Meyer, CPA (17:03):
Now that's really hard to do, especially in smaller firms, which dominate, what, 99% of our industry. Yeah. Tell me more about that.
Divakar Vijayasarathy (17:14):
Well I will, so typically when we look at an accountant, it is like, imagine a cow running a a a beef farm, right? A cattle yard. You would only think like an accountant, but you need to think like an entrepreneur. A practice is not a place where clients come and you solve a problem. It's an institution. But multiple functions where execution is just one function. You've got hr, you've got administration, you've got technology, you've got finance, you've got the future threat to deal with. 'cause Today the problem for accounting firms is not the next accountant, it's the technology firms who are eating into our pie. So the, you need to have a team which is built to deal with scale, built to deal with complexities. Now, a pure play accountant is only focused on numbers. Compliance structuring, strategizing nu around that.
Divakar Vijayasarathy (18:11):
But it takes a lot more to build an institution of scale and which a pure play accounting firm is not acute to do. Because primarily we cannot afford the cost of running a, a large outfit because it becomes a top heavy entity and it doesn't justify unless, unless there is good scale. Sure. And, and the third and the most important insight, so first was about ownership, second was about talent, and third was about execution. We realized execution can never be outsourced. It has to be in-house. Hmm. Even if you are offshoring, it has to be your own entity. You cannot offshore it to a third party. Because unless you control execution, you don't control anything inside the game. Then you, I mean, then you just become a, a syndicate between the client and the, the team, which is executed. So this realization came in 2014.
Divakar Vijayasarathy (19:03):
'Cause Two years I ran the platform, but DVS was running simultaneously. So from there on IUI took these three insights and built DVS for the next 10 years. We converted that to a private limited company similar to a C corp in the us. We consulted all our enterprises under one parent in India, which has never happened. Very similar to what standing wanted to do last year in what they call as a project Everest. And that did, that did not happen for a variety of reasons. So we did that. And what was the most interesting thing, which we did, which gave us exponential scale, was we added business services on top of professional services. So let me give you an example. If Jackie is a high net worth individual who's buying let's say who's making a $10 million investment, and she's buying the 10 million investment from a fund, and the fund says, I will only sell you a hundred million dollar blocks, Jackie does not have a hundred million to invest.
Divakar Vijayasarathy (20:08):
But Jackie comes to DVS for getting a tax opinion on how she can invest this money or what it takes. But what we realize is the real value for Jackie will come if we can make this a hundred million deal from the fund matter tify, so that you can get your 10 million slice. Without, you'll not be able to buy your 10 million investment portfolio investment. So we added a layer of what we call deals to our tax structuring practice. So we started buying portfolios from foreign institutional investors. We structured the taxes, and then we sold these investments to our own high net worth individuals and family office clients. Now, from charging a fee, we started charging a percentile of the profits of the value of the transaction. It exponentially changed the game. Hmm. We were no more a service provider. We were a partner in value creation.
Dr. Jackie Meyer, CPA (21:05):
Yes. That's like value pricing in its finest because you get paid when they get paid.
Divakar Vijayasarathy (21:11):
Exactly. Exactly. We lost a few, a hundred thousand dollars or half a million. A million, but we started to gain many millions in the parking. So this is the premise of DVS. So today, DVS has three core pillars. We've got a professional services rollup platform where we acquire and aggregate. We don't acquire. I would, we, we take, we take slightly over. We, we take 60% stake in CPA firms in the US and we are, we are building our own GCC back in India. The ex global MD of Accenture has joined us. And it's, it's a, it's a solid team. People who've been there, done that. That's one part of what we do. The private deals practice where we work with almost all the alist, Alister firms, you name it. Now we work with them where we acquire wholesale portfolios for sale to high net worth individuals and family offices. And third, of course, this services, which all the CPA firms, which we acquire do for our clients. So this, we do it both in us, India, and in Dubai. So that's devious for you, Jackie.
Dr. Jackie Meyer, CPA (22:16):
Wow. Okay. So tell me more about this kind of roll up of CPA firms that you're doing in the US and abroad as well.
Divakar Vijayasarathy (22:26):
So let me, for, if I were to focus my narrative on the us In the US we are looking at mid-size CPA firms up to 5 million in revenue. People who are stuck for growth, right. Who have scaled, but they're not able to break the glass ceiling because I've been there as a professional, I understand their pain. And what they need at this point is they need capital, they need leadership, and they need execution, which is offshoring. Now. We bring all the three to the table to them. We come on board where the the CPA partner does not need to exit. The partner continues to run, has a 40% stake in the venture, and we invest at the fair value. And we help him ex expand their practice by relieving the mind space of the promoter. Ultimately, Jackie, what we've come to realize is you are an entrepreneur.
Divakar Vijayasarathy (23:20):
The entrepreneur's most precious asset is her mind space. Right? I mean, the last thing you want is to be bogged on by deliverables, on compliance due dates. Is my return filed on time? Is someone taking care of the accuracy of the returns? Now, when that is being managed by a professional team, a team which understands the pain, so we are not a private equity player. We are not an outsourcing shop. We are an operator who does all the functions for the professional who want to expand. And we are very, very choosy in terms of working with our professional firms. Out of the 35 odd firms I've met, we have given just one letter of intent at this point in time to engage
Dr. Jackie Meyer, CPA (24:03):
With. Wow. Okay.
Divakar Vijayasarathy (24:04):
'Cause we want the partner to have a growth mindset. Sure. So I come from a EO YPO mind mindset where, as you rightly said in your introduction, where you had a set of people who will hold you accountable for you crossing over the milestones with courage. In our YPO and EO, we have forums where in the forums we have people who hold us accountable to our commitments. So we want partners who have the entrepreneurial zeal have the hunger to scale. We can bring capital to the table, we can bring top quality leadership to the table. We can bring top quality execution to the table for them. And we, we will grow together. And the intent is to go for a public listing in the US and in India by 20 27, 28. That's the game we're
Dr. Jackie Meyer, CPA (24:48):
After. Wow. Okay. Cool. And so you're looking to invest in or partner with firms of five mil and more in annual recurring revenue?
Divakar Vijayasarathy (25:00):
That what you're up to? Five. Could be one to five then.
Dr. Jackie Meyer, CPA (25:02):
Okay. One to five. Yeah. So that opens up a little bit broader scope of, of the firms. So you said you did a LOI for one out of 35 firms. Tell me what are like the red flags to watch out for when you're looking at firms that you wanna work for? And then like, what are super green flags of like, I mean, are you looking at the type of services they're doing? Are you looking at their net profit margin? What kind of first comes to mind for you as like the best KPI parameter to look at versus the worst?
Divakar Vijayasarathy (25:34):
Okay, great question. So I've done 18 acquisitions in my life so far across markets now. Let, let, let me look at the, what, what are scary for us. The first and foremost is a partner's mindset that we don't want the partner to quit the organization. We want the partner to run the game. Second, how good he or she is in a collaborative ambience. Now have they given out stakes to their own team members? Now, these are very important criteria for us. 'cause In DVS is widely held, it's not held by one person. We've got more than 20 stakeholders. Every single person has become a shareholder inside the company. Cool. So, so we want that mindset. And of course, the hygienes of running the business. See will say what would typically the, the profit margins for what are due for a services enterprise anywhere, anywhere between 20 and 30% are, that's the, that's the number we are.
Divakar Vijayasarathy (26:35):
Margins what we're looking at. But more so more than the services, what matters to us is the partner's mindset. Does a partner have an appetite for growth and have a collaborative mindset? And when that works, then the next question we focus on is the culture cultural alignment. So we have a strong cultural I've got a culture book, maybe I can share it with you after the call, which clearly has where we have written, how we think work and decide. Principle is if it is not a definite yes, it is a definite no. Very simple. Now these are the small, small which, which reduces decision making time. And the entire system is super transparent as an organization. So we want to see if those are practices which are there in their organization, or even if it is not there for a variety of reasons. Is the organization and the promoter's mindset amenable to inculcating these principles? I think that's what is the real key what we are going after. Katie, the mindset of j Jackie, the, the mindset of the person collaborative as well as hunger for growth. I think that's a combination with a good business model.
Dr. Jackie Meyer, CPA (27:48):
Okay. Gotcha. So if a tax or accounting firm owners listening and are like, what's one practical actionable thing I can do to make sure that I have the best mindset for my firm and my growth? What would you recommend for them?
Divakar Vijayasarathy (28:06):
Envision your business practice where it would be in five years from now. And if in that five years from now you are the core pivot based on which the entire practice is running, then we have a serious cause for concern. But if it's going to be an institution where there are multiple stakeholders carrying your flag, then yes, that's the kind of person we would love to partner with.
Dr. Jackie Meyer, CPA (28:30):
Okay. Great. All right. So let's talk a little bit about taxes. Definitely very overwhelming to a lot of entrepreneurs. There's a lot of misnomers around who needs tax planning and whatnot. What do you think the most common challenges that you see in that area? And how do you tend to solve it for people?
Divakar Vijayasarathy (28:57):
Okay, so when it comes to tax, let me zoom out a bit. So in my experience over the last 17, 18 years, we've worked with clients from across, from over 40 countries across multiple jurisdictions. Tax is nothing but a game between a promoter, an entrepreneur, and the regulator. To be frank, governments don't need our tax money to survive. Hmm. And, and have a better example than America where the reserve currency, the dollar is being printed and there is no finite limit to which the dollar can be printed.
Dr. Jackie Meyer, CPA (29:36):
Right.
Divakar Vijayasarathy (29:38):
And there is something called as a modern monetary theory. I'm not getting into that, but tax has always been used by regulators for aligning public behavior. If we go back, let's say 1,500 years ago I, I had a personal challenge. Maybe we have written more about it in the book, but I'll take an example in history, which actually opened up this dimension of thought to me. There was this, when the Arab rulers were expanding their empire, they had this contacts called JIA attacks. So JIA was attacks levied on non-Muslim practitioners if where they don't adopt that religion. But the tax also had an exemption where if you send someone from your family to the military, you don't need to pay. You were exempted from Jia. So if you realize Jia was not to collect money, it was to mobilize army for the government.
Divakar Vijayasarathy (30:42):
Wow. Yeah. And that's exactly what governments do. Even today, if we do what the governments want us to do, so we call it the three piece. Every government has every tax, every government has three Ps. One is priority, second is paranoia, and third is prohibition. If you do what is priority for the government, for example, jobs in any populous country, you get tax credits. Whether this will apply you, you look at it from a global prism, any country which is populous, which has a problem of unemployment, you give jobs, you get tax credits. It's not the salary deductions I'm talking about. You get over and above that you get credits for giving employment, paranoia a second. P if you do what the government desperately wants you to do, one they want to do. For example, in the US I can think of two things. One is the American government wants to manufacture semiconductors in the us right?
Divakar Vijayasarathy (31:43):
So imagine you, you produce, you set up a semiconductor factory, you get land free, you get 50% taxes waived. The list of exemptions are endless. And this is not only with the us it happens across the world. And similarly, America, there is a lot of noise on import substitution. So if you are manufacturing something in the us which substitutes an import from China, there is a huge tax credit available. And these, I don't need to read the tax laws, but just listening to the politicians, this is how the tax code will be. And by and large based on my research, this is true. And the third P is prohibition. Look at casinos look at liquor, tobacco. These are industries which the by social norms are prohibited, but the government will always protect it because they are the highest grosses of tax revenues. And again statistically the, the stock which is delivered, the largest returns over the longest period of time in the US markets is a tobacco stock. So globally, if an entrepreneur aligns her interests with what the governments do, you actually won't be, you don't need to pay taxes, you end up getting rewarded.
Divakar Vijayasarathy (32:58):
Look at what Elon Musk has done in your state in Texas. By setting up factory in Austin. He's got tax breaks, huge tax breaks. The same thing happens to entrepreneurs across the food chain. You don't need to be the largest entrepreneur. You just need to be asking the right question on the regulation. I'm doing this business, I'm giving jobs, I'm manufacturing something which the government is currently importing from China. I'm manufacturing something which the government desperately wants. What am I getting in return from the government? For sure, you'll have an answer just that the American tax code is 9,000 pages, if not more, where it is humanly impossible for someone to know the entire code unless you specifically search for it. So our recommendation for entrepreneurs is understand your contribution to the government and ask the right questions of the regulation. For sure.
Divakar Vijayasarathy (33:55):
There is a tax break available. There is a statistic in the US which says that two thirds of tax incentives in the US which are published are not being claimed. Wow. In one of the in one of my earlier research. Imagine us a country with so much of information dissemination, it's two thirds is not being claimed. Yeah. In most part of the world, it's much, much higher. It's much, much higher. So we as entrepreneurs need to ask the right questions. What am I, I'm giving you so much. Yeah. What am I getting in return? Yeah, you'll definitely have an answer for sure. And that answer is what we call a tax structure.
Dr. Jackie Meyer, CPA (34:31):
I love that. So yeah. Where do your interest ethics align with what the government is propagating right now? And, you know, so how do you maximize that tax benefit around that? I mean, you mentioned so many things there that have way deeper layers. You mentioned, you know, alcohol. I just saw how a study came out recently that alcohol is like literally been found to be like the most toxic <laugh> substance ever. And it's one of two drugs that can actually immediately kill someone in withdraw. And there's so many people going through that. I personally know someone that had withdrawal seizures and now has what people call wet brain, and they're very young in their forties. And this is happening almost on a daily basis, but we don't hear about that <laugh>. Exactly. So I, I'm sorry to go on a tangent, but that's very personal to me. And I think that it's important for us to, I think a broader statement of, I love how you explain the tax system, but from a broader perspective, we have to we have to continue learning and evolving and educating ourselves so that we know what's really going on out there versus just what we're being told. Right.
Divakar Vijayasarathy (35:50):
Exactly. Exactly. Exactly. And Jackie, the entire game is about alignment. Align what you do with what the governments want, and whether we like it or not, ultimately the supreme power is with the regulator. And the regulators look at the direction of the regulation, will clearly tell you where the governments want you to invest. What are the activities they want you to do. And if a savvy entrepreneur is going to someone, I mean, America is a la I mean, is a mecca of capitalism. If a savvy entrepreneur is going to look at the government policy, just like how a YouTube creator or a Facebook creator listens to Zuckerberg's speech and then prepares their content strategy for the next year. I think for us, it's what the government wants us to do. If they are saying, if Mr. Trump says I'm going to promote import substitution, I think manufacturing is a way to go. And when that happens automatically, there will be huge tax incentives at play. You don't need to evade any law. That's what we say, don't evade align when you align. Your tax costs are drastically low. Tax is the cost for non-alignment.
Dr. Jackie Meyer, CPA (37:04):
Yeah, totally makes sense. While we're on the topic, I'm sure you probably have some really great insights here. What are your predictions with Trump in office, again for the next four years? Do you think it's going to be very stable and he's going to extend as much of TCJA as possible? Any kind of loopholes that you think will be thrown for there?
Divakar Vijayasarathy (37:27):
To be very honest I don't know the American tax code in general, but I'm looking at, I'm, my perspective would be more at a macro level as an observer. Yeah.
Divakar Vijayasarathy (37:37):
Now, from that standpoint, Trump at the helm of affairs would be pro-business. Which means tax rates may not go high. Yeah. But what will be very clearly looked upon as the tariff regime. So his focus as, as he's already enunciated, would be to make sure that if you are importing X to America, we would also have the right to export at least X to you. Today, the trade deficit across the globe to, towards us is substantial. But partly it's because of the fact that America, the, the dollar is still the reserve currency. So with that being said, I feel there'll be a huge emphasis on import substitution. Tariff rates. I'm not too sure if expanding tariff rates would would be a solution or maybe enforced in the right, I mean, in the manner in which it is being propagated. Primarily because it could make domestic consumption unviable on most products or, or services. But where I see real core emphasis happening is import substitution. Okay. And, and it's a great time to be an entrepreneur at this point in time, at least for the next four years already seeing the jubilation on the ground. So let's hope it materializes.
Dr. Jackie Meyer, CPA (38:55):
Yeah. Nice. Okay. let's talk about your 15 books. Is it the 16th that's coming out with Forbes soon, or is it the 15th? I, it's, it's hard to keep count of all the books.
Divakar Vijayasarathy (39:08):
I don't count. It's, it's closer to about 17, 18 at this point in time.
Dr. Jackie Meyer, CPA (39:11):
Oh, my bad, my bad. <Laugh>.
Divakar Vijayasarathy (39:13):
No, no. I mean, so I dunno where.
Dr. Jackie Meyer, CPA (39:17):
Okay. So where does one start? If they're interested in what you have to say? We know the audience here is mainly, you know, accountants, professional service firms. What book, I guess I wanna ask, what's your favorite of all the ones you've written, but also which one do you think that our listeners would enjoy the most? To start with...
Divakar Vijayasarathy (39:37):
I mean, just to begin with, except the current one, which I'm writing with Forbes, that the rest have all been technical books. They would be on transfer pricing, understanding international tax understanding capital gains. But I would say the one which is coming out in the month of April which is titled Don't just Pay Taxes. It's not, this is anyone from Paying Taxes. It's only about giving them just pause before you get into that journey. Understand what it takes to align with the government. I think that book quick summarizes my 18 years of journey in this era in, in, in, in this subject. So I would sincerely expect or recommend users, I mean listeners to start there. And if they are keen on understanding the fundamentals of international tax, that's the title on which I've written. It's called The Fundamentals of Understanding International Tax.
Divakar Vijayasarathy (40:35):
It's typically talks about how countries negotiate with each other on the tax treaties and how each of these clauses of the treaties need to be developed upon to make sense of it. Because most of the times, the letter of the law and the way in which the law is actually being implemented could be very different. And that's a function of why that law was originally brought into force, what we call the memorandum of the legislation. So that book would give them a perspective. I think these are the two books I would recommend them to if they're keen on understanding my dimension of thought. And of course I do write on LinkedIn of late, but I don't write much on tax. I write much on trying to understand human nature. Sure. And that's my current area of interest. So right on that as well on LinkedIn. Okay. We're coming up with podcast very soon, so.
Dr. Jackie Meyer, CPA (41:29):
Nice. Okay. Definitely looking forward to the release of that book. Reminds me, treaties reminds me of the beginning of my accounting career. I got in the back door at Deloitte in their international tax department in Dallas. And we would just create these excel calculations of expats between the US and other countries, what the tax mitigation effect was. And it was so much fun. <Laugh>.
Divakar Vijayasarathy (41:59):
Exactly.
Exactly. Exactly, exactly.
Dr. Jackie Meyer, CPA (42:01):
Yeah. There were like 26 countries back in 20 2008 or 2009 that we were specifically focused on. I don't remember why 26, but we created these like really complex macros and excel calcs and whatnot around them. And you know, it's when I kind of fell in love with Excel for sure. <Laugh>.
Divakar Vijayasarathy (42:24):
No, no. Lovely. Yeah, it's fascinating.
Divakar Vijayasarathy (42:28):
Jackie just, my team just messaged me saying I used to be on the Forbes Council. I don't at this point in
Dr. Jackie Meyer, CPA (42:34):
Time. Ah, okay. Good to know. Good to know. It's, that's cleared up now. Everyone was wondering. <Laugh>, I'm just kidding. <Laugh>.
Divakar Vijayasarathy (42:41):
No, no. But, the last thing you want is to go on with the wrong, wrong claim.
Dr. Jackie Meyer, CPA (42:45):
For sure. For sure. Yeah, no worries. Okay. So with misconceptions with international tax, I mean, you've already kind of talked about this in a way, but what would you say the biggest misconception is when people consider international tax? Implications?
Divakar Vijayasarathy (43:07):
Okay. Now again, I would prefer to zoom out and then zoom in. Okay.
Divakar Vijayasarathy (43:13):
If you were to slice the world into three parts, there are three categories of countries in the world. Capital exporting countries, capital importing countries, and conduit countries. We call it the source countries, the destination countries and conduit countries. Now, now the tax laws of source countries are very predictable. It would have source based taxation. It would have what do you say dividend withholding interest tax, all the, all the provisions which are required to ensure that when capital goes out, income which comes and gets taxed. Okay. Con conduit countries will have neither, they act as the flow between source and destination countries. So they will have zero capital gains. They won't tax foreign dividends, they won't tax interest paid to foreign countries. They will be very minimal to nil withholding taxes. And then you have the destination countries, which will be high complex tax laws.
Divakar Vijayasarathy (44:23):
They will have high withholding tax rates. These are countries which will give a lot of exemptions for investment, but they'll put a lot of frictions for repatriation of that money. So this is at the highest level how the world is structured. And in, and with this prism, you start looking at an international tax situation, then the, the priorities of the countries become very clear. Let me take a simple example. If it's between US and India now, US has its own what we say globally, there are four kinds of treaties. We have the UN model convention, you have the OECD model convention, and then you have the Indian Model Convention, and of course the US model convention. And so when you look at international tax, we will go back to the model conventions, which are more like templates, which will give us a premise on which basis, which every treaty is negotiated. And on that basis. So anyone who's trying to make sense of international tax, first, my two sense is understand the nature of countries you're dealing with. Is it a source, conduit, or destination country? And then you look at what is the model convention which has been adopted. I think these two will give you the filters to interpret the particular tax code or tax treaty, which you're trying to understand more than the treaty itself. I hope it makes sense.
Dr. Jackie Meyer, CPA (45:54):
Yeah, no, that's a great way to look at it. I think that makes a lot of sense to people. All right. So we're gonna have to wrap up in a couple minutes. Is there anything else that we haven't touched on yet that you wanted to make sure and address with our listeners? Or, you know, any knowledge or education that you had that we haven't touched on yet?
Divakar Vijayasarathy (46:17):
I mean, I'm just curious to understand from you, Jackie, I mean, in terms of how the American CPA views the tax code.
Dr. Jackie Meyer, CPA (46:27):
How we use the tax code, what do you mean? Tell me more.
Divakar Vijayasarathy (46:31):
How the American CPA views the tax code. Do they look at it as a set of compliances to be adopted or a set of opportunities to be explored?
Dr. Jackie Meyer, CPA (46:39):
Yeah, hold on. Okay. That's a great question. All right. I would say that the average accountant, and y'all can, you know, correct me if I'm wrong out there, a lot of my listeners are not necessarily the average accountant or CPA, but the average one is focused on compliance, the set of rules and following those rules. Something that I'm trying to break. I'm in love with tax advisory myself. You know, we didn't really get into that side of it, but, you know, I'm just eating up everything you're saying because I, I love legally manipulating the tax code to optimize it for my clients. Right. Magically producing money from your knowledge. So it's just there, there's so many win-wins when it comes to the tax C So I use it personally and in my CPA firm towards legally optimizing what I can or manipulating, if you'd say it that way, to legally towards whatever you know, is gonna help your client.
Dr. Jackie Meyer, CPA (47:39):
And I really like what you said about looking at the alignment of government incentives with what the client wants to accomplish, because that, at the end of the day, that's exactly what we're doing when we're proposing tax planning and strategies. Exactly. Is figuring out if you are a real estate investor, let's figure out what those loopholes are. You know, what are the, the things that the government said, Hey, here's what you can do to save a ton more in taxes than the average Joe or Jane. Right? So that's where I think the future of the profession really lies as AI and whatnot kind of take over more of the compliance work. I think the, the word accountant that a for accountant really needs to transform more to advisor. And that's kind of what I'm pushing through tax advisory, TaxPlanIQ, my software and whatnot. What are your thoughts on that?
Divakar Vijayasarathy (48:36):
I think you have nailed it because I'm, before I, I think this is one thing I wanted to mention. I did go through the demo of your TaxPlanIQ software. It was fascinating.
Dr. Jackie Meyer, CPA (48:44):
Oh, thank you.
Divakar Vijayasarathy (48:46):
It it succinctly and it was, I I, I could see a lot of intellectual depth in which you've, you've, you've built that software, I mean, congratulate you for what you've accomplished
Dr. Jackie Meyer, CPA (48:57):
There. Thank you very much. I appreciate that.
Divakar Vijayasarathy (48:59):
And that aligned, I mean, where you rightly said, right? I mean, you're looking at or manipulating, I mean, I would you, you, you're using your intellect to align. That's how I would that
Dr. Jackie Meyer, CPA (49:09):
Oh, that sounds even better. Intellect to align <laugh>
Divakar Vijayasarathy (49:13):
<Laugh>.
Dr. Jackie Meyer, CPA (49:15):
I'm gonna steal that.
Divakar Vijayasarathy (49:16):
No, it's, it's, it's yours. It's what you've been doing, what you've been doing. So I think what you said, the average accountant now not only in the u across the world, I think the profession, it's time for the profession to reimagine. And where we move from activity based engagement to value creation engagements. Yes.
Divakar Vijayasarathy (49:39):
Actually based pricing to value creation pricing. I think we as human beings are naturally aligned to pay for outcomes rather than efforts. I mean, no one wants to pay for time, no one wants to pay for efforts. But if I'm gonna make you a hundred dollars and I'm going to charge $10, you not have a problem. But if I'm gonna do an activity and charge you even $5, you will still look at it as a cost and not as a, a sharing of rewards. So I think that's the mindset which the promoters or the partners of the CPA firms now need to look forward. And this has been our experience working across four jurisdictions. I, I'm glad that you resonate with that and what you've been doing with your software. And I'm wishing you all the very best in your journey and through kudos to what you've been doing for the profession as well.
Dr. Jackie Meyer, CPA (50:30):
Thank you so much, Diva. I really appreciate that. And kudos to you for all of the knowledge sharing that you've been doing with your dozens of books and your company and how you're impacting. It sounds like you have big goals to impact the world. So, on that note, if someone wants to touch base with you or learn more about what you do, what's the best way to get in touch with you,
Divakar Vijayasarathy (50:55):
Ma? I'm on LinkedIn, so that's the easiest and the fastest way to reach out to me. Perfect.
Dr. Jackie Meyer, CPA (50:59):
So we'll add a, a link to your LinkedIn so that everyone can touch base there. Is there a website that people can go to to learn more about your company? Absolutely.
Divakar Vijayasarathy (51:10):
Our company, it's one dvs.com. O-N-E-D-V s.com.
Dr. Jackie Meyer, CPA (51:14):
Awesome. All right. Well thank you so much for your time. I have to admit, you know, the questions I had prepared were kind of dry. It's like, tell me about your company, tell me about that. And I really enjoyed kind of taking things deeper. And I really respect where you're coming from and it's a pleasure to meet you.
Divakar Vijayasarathy (51:34):
Oh, likewise, Jackie. Truly enjoyed the interaction and hope to meet you in person sometime. For sure.
Dr. Jackie Meyer, CPA (51:39):
All right guys, well that's the conclusion of The Concierge CPA. Y'all take care. Goodbye. Thank you for listening to the concierge CPA hosted by TaxPlanIQ. We believe that every person has a unique message that can positively impact the world. If you are a successful accounting firm, owner or influencer who would like to be on this program, please visit jackiemeyercpa.com, J-A-C-K-I-E-M-E-Y-E-R cpa.com to apply. Please share this on social media and rate us so we can continue our good work. Join our Facebook group called Accounting Firm Influencers, or connect with me on most platforms under Jackie Meyer, CPA. Thanks for being accountable to transforming our industry today.
Jackie and Divakar highlighted the immense potential for accounting firms to scale by embracing strategic growth and innovative practices. As firms navigate challenges like compliance, talent shortages, and increasing client demands, tools like TaxPlanIQ provide the foundation for success. By streamlining tax planning and showcasing personalized strategies, TaxPlanIQ enables accountants to deliver exceptional value while freeing up time to focus on scaling their firms.
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