How Sole Traders Can Be Overpaying Thousands in Tax (And What You Can Do About It) | HNRY’s James Fuller

**Mark Bouris** (0:00)
James Fuller, welcome to The Mentor.

**James Fuller** (0:02)
Thank you.

**Mark Bouris** (0:03)
Man, I was driving down William Street on my way to the studios here this morning, and I saw on one of the bus stop rolling posters, I saw Henry being advertised, HNRY.

**James Fuller** (0:16)
That's right.

**Mark Bouris** (0:18)
And I actually haven't seen a lot of it lately, but all of a sudden I'm seeing this, it's a bit like when you buy a new car, all of a sudden you start seeing that car for some reason. I'm seeing Henry all over the joint.
You're the co-founder of HNRY, NCO.

**James Fuller** (0:31)
Correct.

**Mark Bouris** (0:32)
What does HNRY do?

**James Fuller** (0:34)
HNRY is an all-in-one service that takes care of all of the tax admin for sole traders. So effectively, we make sure that sole traders are always up to date on their tax and we are also one of the largest accountancies in Australia.

**Mark Bouris** (0:47)
Okay. Well, let's look at sole trader first. Why sole trader?

**James Fuller** (0:51)
So the business actually started, my wife and I were sole traders.
For anyone out there that's been a sole trader, it can be quite a frustrating experience. We weren't raised with financial knowledge and the reason we were sole traders is not because we were trying to start a business, it was just we happened to work in industries where it was just normal to be a sole trader.

**Mark Bouris** (1:10)
What were you doing, Dima?

**James Fuller** (1:11)
I was doing some contract work for tech startups and my wife was doing work in government, so she was doing policy work.

**Mark Bouris** (1:22)
As a contractor?

**James Fuller** (1:22)
As a contractor, yeah. So short term gigs, maybe sort of six months at a time, something like that.
And yet we just didn't know anything about tax. And you do what most people do, you go out and you get the traditional accountant and they give you whatever flavor of software they like and you then become your own admin person. You're there doing the reconciliations, you're doing the categorizations, you're doing all of this stuff and you're paying through the nose for the privilege. And then at the end of the year, the accountant goes and asks you, is this everything? Have you claimed everything? And then they charge you an absolutely eye-watering sum. And we sat there and we said, this just isn't fair. You know, we're doing all the work throughout the year. We're then paying for the privilege of doing it. And we still don't know how much of our money is actually ours at any one time. You know, we've got two young kids. We want to know, can we afford those rentals? Can we afford a family holiday? So we started off just running a spreadsheet. We said, we'll work out how much tax we need to be setting aside and we'll try and work out how do we make this work for us as a family. And it sort of got out of hand from there. We had friends come to us and said, hey, look, we're contractors. What do you do about your tax? And we said, look, we've got these spreadsheets. We've got this way of working it out. And in the end, we sort of said, well, maybe we're not the idiots here. Maybe we've got something. Maybe we've got a service that could benefit other sole traders.
And so we spun up a one-page website and put $100 into a Twitter ad campaign and people signed up and yeah, we're what, nearly nine years later, we're 150 staff across three countries and managed the taxes of tens of thousands of sole traders.

**Mark Bouris** (2:56)
Wow. During that period of dealing with sole traders, and listening to all their woes about this particular aspect of their business, as I understand it for a sole trader, you're working six days a week.
In your case, you're a contractor, but you could be a plumber. Six days a week are running your business.
Listen to everybody's problems and turning up to their home or their business to fix it up, and then trying to get the right advice to them or physically sort of execute. And then at night, you probably get home and you're starting to write up your books. Yeah. And then on weekends and on Sundays, and there's no time. Is that the sort of scenario? What are some of the case studies you've come across?

**James Fuller** (3:42)
Yeah, 100%. I mean, the case study you've just used there is fundamentally, that's the one, that's the go-to, right? Everyone understands that one. But the sole trader economy, we're talking about 1.5 million Australians.