When UK Chancellor Rishi Sunak announced the Self-Employment Income Support Scheme (SEISS), many gig economy workers missed out because their tax returns either weren’t up to date, or they hadn’t realised the implications of not filing.
Working with Deliveroo, untied, the personal banking app backed by Barclays and founded by payment and automation experts, decided to create a new tool specifically for this part of the sector.
Currently, platform workers – those who work across multiple industries – represent the fastest-growing segment of those who need to submit tax returns and while filing is relatively straight forward, many are not familiar with the UK tax system and proportionate to income, the cost of using an accountant is high.
Working quickly, untied designed and deployed a totally new product – untied for gig workers. It had a specific onboarding process and built-in translation. Recognising that people tend to work for multiple platforms, it supported the key ones directly, and additional platforms were available to add if needed. It then promoted the service to riders directly via emails circulated by Deliveroo on untied’s behalf and on social media.
Within 28 minutes of the tool being available, a Deliveroo worker had filed their tax return and during its peak, a new user signed up every 27 seconds.
Untied CEO Kevin Sefton explains, “We found there was a need to support individuals tax filings, particularly for self-employed workers claiming the SEISS grant, which added urgency to ensure that individuals were upto date with services in order to get the government support.
“One thing that did surprise me is that we needed to effectively build a new product. This community really needed was something slightly different, and indeed simpler that would support mobile tax.
“I think this is a really good example of how you can build on APIs. We found that we could already use one of our API’s in order to deploy this new product. This meant that it was a completely new codebase in terms of the front end, but the back end is highly configurable and that’s what really made it work.”
While the existing untied app provided the ability to input a variety of income sources, it also includes the ability to support investment income, manage property deductions and make suggestions. The team thought it was probably more than what was needed. After evaluating the needs of platform workers, untied realised that many were held up from filing due to simple matters, such as not knowing their HMRC login.
The new tool includes a way to file without knowing these details, untied express submit, and so far 52% of those using it have submitted returns this way, a huge number who perhaps previously wouldn’t have submitted their return at all.
Sefton added, “What we see is actually a strong desire amongst people to be compliant. And when we did speak to Deliveroo drivers, a lot of them just weren’t aware what they needed to do. Many knew that they had to file a tax return but thought that because they were earning less than the threshold that they didn’t need to.
“This is not confined to this sector, it’s a worry for all people who have to do their tax returns and across the board there is uncertainty and lack of confidence of what they need to do in order to meet these obligations.
“The other thing that we take to actually in terms of kind of things in terms of the process. We did quite a lot of work actually with language. we found that a lot of people who are non-native. They struggle with some of the terminology. In some cultures, the word return is interpreted as a tax refund, so it’s important we recognise these issues.”
Building on this, untied for gig workers includes support for people who have English as a second language and even built-in translation services.
Since the new tool was launched, different user behaviour has been identified – as people started to complete their new filings for 2019-20 ahead of schedule. Some were even preparing them both and submitting them together, hoping to avoid any late payment fines from HMRC.
Untied have certainly kept busy in lockdown, not only launching untied for the gig economy but also announcing a strategic alliance and joint bid with and Fractal, a smarter payments engine and insights platform, to the Banking Competition Remedies (BCR) Capability and Innovation Fund.
Together the partners have created SMART – SMEs Manage Accounts Receivables and Tax – to address working capital issues leading to the collapse of 50,000 smaller businesses a year
The initiative’s focused on sole traders who represent the greatest number of businesses in the UK. They are key drivers to the UK economy. The tool will help sole traders easily invoice customers, and track and incentivise payment through discounts and penalties. SMART integrates cash flow management by anticipating costs, specifically tax payments.
Fractal and untied estimate that by 2025, SMART will decrease average outstanding debt to Small-Medium-sized-Enterprises (SMEs) by 29%, saving the UK economy £1 billion per year.