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untied aims for scale with Earnr acquisition

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Personal tax tool untied has acquired ‘side-hustle’ tax app Earnr in a bid to grow its customer base ahead of Making Tax Digital getting underway in earnest.

9th May 2024
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Launched in 2021 and initially backed with £650,000 in venture capital cash, Earnr targets UK creatives such as Instagram, Twitch or OnlyFans creators, gig economy workers, and those with property rental income.

The app provides digital bookkeeping via bank feed connections, tax return filing and basic reporting functionality, and is also developing an AI chatbot trained on HMRC guidance to answer users’ tax questions. 

However, as with tools such as Coconut and TaxSheets, Earnr targeted Making Tax Digital for Income Tax as a growth opportunity – an ambition seemingly hampered by multiple delays to the government’s flagship tax digitisation programme. Despite a customer base reportedly in the low thousands, the company’s latest micro accounts show its capital and reserves have dwindled from almost £500,000 in 2021 to £26,000 in the red.

With Earnr’s founders looking at alternative futures for the business, personal tax app untied swooped to acquire the app for an undisclosed sum. In a statement accompanying the news, untied said it will continue to run both brands alongside each other.

Seeking to scale

Kevin Sefton, CEO of untied, told AccountingWEB that Earnr was a “good fit” for what untied is trying to achieve, praising founders Enzo Ottens and Anil Nair.

“Earnr’s founders have built a great app and user experience,” Sefton told AccountingWEB. “We like the look and feel, it’s a strong brand and complements what we already have with untied.

“It’s not easy for tax-filing products at the moment, so we’re seeking ways to scale. There may be more opportunities for consolidation until Making Tax Digital (MTD) for Income Tax gets underway in earnest,” he added.

Earnr includes initial registration with HMRC, a service which Sefton feels reflects that more people are coming to Earnr at the start of their tax journey. 

“[Earnr users] find registering via a third party easier than navigating HMRC options,” said Sefton. “This is a good example of how software can improve tax engagement and compliance. Earnr also emphasises bookkeeping year-round rather than simply “filing”. This helps people stay on top of what they must do, whether self-employed or landlords."

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