Kiwi startup making it easier for the self-employed to handle taxes
Kiwi FinTech startup Hnry is giving self-employed people the freedom to focus on their business by automating their income tax, GST, ACC and student loan payments.
Hnry turns self-employment into a ‘pay-as-you-earn’ model, free from the risk of severe consequences that come with non-compliance.
Self-employed people organise for their clients to pay Hnry directly, Hnry then takes care of all required payments – ensuring fees are paid accurately and on time.
As soon as the client has paid, the sole trader is immediately paid their take-home income, Hnry doesn’t hold money or delay payments.
Total fees are one percent of income, capped at a maximum annual fee of $2,000 for high-earners.
Hnry’s co-founder and CEO James Fuller says in most economies the systems and processes that come with being self-employed are fundamentally broken.
In New Zealand, these systems aren’t in line with modern requirements, meaning they’re completely out of touch with the self-employed.
“Over the past few years, there has been a significant rise in organisations looking to employ freelancers and contractors so they can scale up and down their workforce.
“Also, the idea of working multiple jobs at the same time is becoming commonplace, and the gig economy is impacting many different industries – but we need the right systems in place to make this work. Hnry provides the wiring for the gig economy,” Fuller says.
“For self-employed New Zealanders, working out their income tax, GST, ACC and student loan repayments is a complex and daunting experience – misunderstanding and misinformation in this area is rife, and the consequences for making mistakes are severe.
“We’ve built a system that takes care of this, so sole traders are free from risk, have more time to ensure they’re servicing the clients to their best ability and allowing them to have a better work-life balance,” Fuller adds.
While accounting platforms exist to support small, medium and large businesses, the needs of sole traders are very different and haven’t previously been catered for.
Hnry has been built for all types of sole traders, such as Uber drivers, freelancers, graphic designers or someone running a drop shipping business.
The team aims to have 20,000 users by September 2019 and have a clear roadmap to add functionality that will enable Hnry to launch in Australia, the UK, and the US.
“There are currently more than 400,000 New Zealanders that have declared themselves as self-employed, according to MBIE, not including additional undeclared sole traders, such as those running a ‘side hustle’ additional to traditional employment.
“However, from our research, it is estimated that the current total market size of the freelance or gig economy is more than US$1.5 trillion. This figure is only expected to rise, with some predictions in the US stating that by 2020, 40 percent of their entire workforce could be self-employed,” says Fuller.
Hnry has been supported by the Kiwibank Fintech Accelerator (KFA) programme, a three-month business growth programme helping FinTech startups bring their solution to life.
Hnry is pitching for its first round of external investment at the KFA Demo Day tomorrow. The team will use this investment to fund further development of the platform ahead of exporting their service.
The business was founded by James and Claire Fuller, and Richard Freestone.
The team launched its alpha trial in April 2017 with two customers as proof of concept and then moved to beta testing in July last year.