It was billed as particularly good news if you have a side hustle, like making extra money through sales on eBay, dog walking, or creating content online. ‘We are changing the way HMRC works to make it easier for Brits to make the very most of their entrepreneurial spirit’, the government said.
But tax wouldn’t be tax if there wasn’t some small print. Not needing to file a tax return is not the same as there being no tax to pay on money received. There are two allowances of £1,000 each, which can be set against trading and property income, but income from a side hustle above this level is likely to be taxable.
What the government is going to do — and it hasn’t happened yet — is put up the Income Tax self assessment reporting threshold for trading income from £1,000 to £3,000. HMRC expects that though 300,000 people may not need to file a return, 210,000 of them may still need to pay tax, and the plan is that they will be able to do so through a new online HMRC service yet to be unveiled.
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Information for readers: This material is published for the information of clients. It provides only an overview of the regulations in force at the date of publication, and no action should be taken without consulting the detailed legislation or seeking professional advice. Therefore, no responsibility for loss occasioned by any person acting or refraining from action as a result of the material can be accepted by the authors or the firm.
*Business Newsltter August 2025
