Startup Spotlight: TaxScouts is taking the pain out of tax returns
As we continue our series of flash interviews on startups to watch in 2020, we speak to Mart “Tram” Abramov of accounting software company, TaxScouts.
Hi Tram, could you tell me a little bit about TaxScouts?
TaxScouts makes personal tax returns completely stress-free by doing them for you, online, for a single flat fee. For just £119, all in, every return is quickly prepared and submitted by a matched, certified accountant. No jargon or worrying about making a mistake again.
What makes TaxScouts stand out from its competitors?
TaxScouts brings together taxpayers and accountants to make the process of filing tax returns painless. We make it more efficient for accountants by providing them with the information they need all at once - which is why we can charge as little as we do - and less painful for taxpayers.
In the UK, 11.5 million individuals need to complete an annual self assessment. Taxpayers can do it themselves, but knowing what to do, when and how isn’t a straightforward process. HMRC has many resources to navigate, but you have to know what you need and where to find it.
Every TaxScouts return is quickly prepared and submitted by a vetted accountant after asking just a few questions. By using technology to make the process more efficient, and a combination of human support and tax review, we make it possible for more people to do their tax returns, with less stress.
What has been TaxScouts most recent achievement?
In January 2019, TaxScouts raised £1.2mn in funding to double its team in the UK while also investing in operations and marketing. We are rated number 1 in tax preparation on Trustpilot, with a rating of 4.8.
The number of employees grew from 3 to 10. The company currently works with a double-digit number of accountant partners across the UK who do customer tax preparation.
Is there any exciting news you’d like to share with our readers at FinTech Magazine?
At the moment our main focus is the current tax season that is ramping up. We hope to have lots of exciting news and updates following January 31st.
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What can we expect from your company in 2020?
We want to keep helping accountants be more efficient - we’ve already eliminated up to 40% of admin for them. We want to increase that to 80% so that they can do more, better. We’ll also look to partner with more accountants who are specialised to cater to user situations that are a bit less straightforward and to partner with more platforms and organisations whose community need to efficiently do tax returns.
In terms of scale, we still have an opportunity to serve more taxpayers in the UK over the next few years. At the same time, we’re conducting research on other markets with similar tax systems so we can launch TaxScouts in another country in 2020.
About Mart “Tram” Abramov
[Image: Mart “Tram” Abramov]
Mart “Tram” Abramov has over 15 years B2B and B2C product management experience, helping launch and innovate some of the world’s most recognised tech brands.
He is originally from Estonia and worked with the leading tech companies that emerged from the country. Before starting TaxScouts, Tram was Head of Product at Intuit UK, the company behind SME accounting software giant Quickbooks, and business financing startup MarketInvoice. He was employee #8 at TransferWise, where he led user experience, web, localisation and conversion product teams, and he led the Skype for Business product team at Skype.
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FIVE things fintechs must do to keep investors onboard
New investors flocked to the stock market during the COVID-19 pandemic. Thirty-eight percent of investors said they had never had a brokerage or similar account before opening one in 2020.
Low or no-fee trading options have helped accelerate the trend – nearly half of new investors said they accessed their account primarily through a mobile app. As FinTechs, how do we create the trust needed to keep new investors in the market and create a fruitful customer experience for them?
The financial industry does a disservice to individual investors if we merely offer tools that focus on making money quickly, an approach that usually backfires. Instead, the surge of interest presents an enormous opportunity for those who want to help more consumers use financial technology to educate them on responsible spending, saving, and investing in order to achieve financial wellness current fintech tools have welcomed individual investors in the door.
Now, it’s time to focus on education and improving their experience going forward. There are several ways those of us in fintech can step up to shape the future of retail investing so that it works better for everyone, starting with the following areas.
Equal access to financial wellness education
Financial health should be available to everyone — but today, not everyone has the educational resources to achieve it. One study shows that only 3.9% of students from low-income schools were required to take a personal finance class. What they aren’t learning in school or from family members, fintech companies can provide on their platforms.
The companies should move from solely offering financial services to a more responsible model of education, advice, and prescriptive choices to help consumers develop better habits and make wiser financial decisions. Not only can they empower consumers and bridge historical wealth divides, but they can also stimulate growth by opening up new consumer segments.
Just as we’ve come to expect that our fitness routines are tailored to our individual bodies, we’re also ready for finance tools that go beyond one-size-fits-all solutions. But only six percent of financial institutions say they’re using the kind of technology that allows them to deliver a deeply personalized experience. Fintech tools need to reflect that financial success looks different for each of us.
For one consumer, it may mean providing guidance on how to pay off student loans early; for another, it may mean prescriptive actions that enable them to stick to a budget for the first time; for a third, it could look like prioritizing environmental, social and governance (ESG) investments, so that her portfolio aligns with her political beliefs.
Now, we are seeing financial technology beginning to meet the demands of personalized finance in a substantial and meaningful way.
The rise of AI-Powered Advice
Big-picture advice and predictive guidance used to be a feature of high-end financial advisory firms — a perk only available to those who could afford it. But thanks to rapid advancements in data analytics and artificial intelligence (AI), that kind of holistic advice is now more accessible than ever. AI-driven robo-advisors can parse many different streams of financial information, delivering customized answers to key questions: Is it time to buy a home, or is it smarter to keep renting? Can I afford to take out another student loan?
Intelligent connectivity powered by AI can anticipate consumers’ needs and next steps, making proactive suggestions that guide them along the path to financial wellbeing. Fintech companies can also help consumers identify when their financial picture becomes too complex for a robo-advisor, and help them find a human financial advisor to meet their needs.
Focus on financial mental health
New investors are quickly finding that the market can be overwhelming. That’s not surprising, financial anxiety is common and studies show that financial stress can have an impact on mental health for some.
It’s not enough for fintech companies to give retail investors access; they also must provide the guidance and support that help consumers manage their financial well-being. Educational tools can ensure that consumers are well informed about their options.
Predictive analytics can anticipate consumers’ questions, serving them key information and insights before they ask. Features that emphasize a comprehensive notion of financial well-being, rather than short-term wins and losses, can also help ensure that consumers are keeping their eyes on the bigger picture.
Gamification for good
The surge of gamification apps has done an impressive job making investing as engaging as playing a video game or joining a social media platform.
Much of the current use of gamification emphasizes short-term thinking, but there’s also an opportunity to help consumers think more broadly about their overall financial picture. One example is peer benchmarking, a feature that enables help consumers to see how their financial habits compare to those of friends and fellow consumers.
Gamification can also be used to incentivize making smaller, smarter choices — for example, rewarding saving over making an impulse buy.
The future of fintech is about more than just broadening access to the markets. It’s about making sure more individuals have access to the tools that can help improve their financial well-being—in the ways that suit their own circumstances and needs. The potential to act within their own set of individual priorities, with their long-term financial wellness in mind is much more empowering to a consumer than simply relying on short-term, high-risk investments.
About the author: Brandon Rembe is CPO at Envestnet Yodlee. He has over 18 years of experience building high-growth technology, software, and information service companies, Brandon has worked across a broad spectrum of enterprises from early-stage ventures to global businesses.