People earning more than £1,000 through a side hustle must declare it to HMRC
A reminder has been issued to anyone who earns extra money through a side hustle(Image: Getty Images/iStockphoto)
HMRC has issued a warning to anyone in the UK who earns money through a side hustle to ensure that people comply with their tax responsibilities.
A side hustle is a term which covers ways that someone might make money outside their main job. It can vary from selling clothes on platforms such as Vinted or eBay, dog walking, delivery work or tutoring, among other methods.
But there are tax rules for side hustles that people should be aware of – and HMRC has issued a reminder.
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Everyone has a £1,000 tax-free allowance when it comes to side hustles, which means that if you earn less than £1,000 in one tax year – which runs from 6 April to 5 April – you do not have to declare this to HMRC.
But as soon as that earnings go over £1,000, this must be declared to HMRC. This can be done by registering for Self Assessment as a sole trader.
Kevin Hubbard, HMRC’s Director of Small Business & Individuals, said: “For many people, a side hustle is a valuable source of extra income. If you’re earning more than £1,000 a year from your side hustle it’s important to understand your tax responsibilities, and HMRC wants to make that as straightforward as possible.
“You can check if you need to do a Self Assessment tax return by using the tool on GOV.UK. It takes minutes to use, tells you exactly what you need to do and means no unexpected tax bills later.”
Any earnings over £1,000 must be declared to HMRC(Image: Shared Content Unit)
To flag your earnings with HMRC, people can use this tool on GOV.UK. It will ask you a few questions about how you earn money through your side hustle, and if a tax return is required, it will explain how to register.
HMRC has advised that new entrants to Self Assessment should register for the 2025 to 2026 tax year by 5 October 2026. They must file their online tax return and pay any tax due by 31 January 2027.
The £1,000 threshold covers all side hustle income combined – so someone earning £600 from wedding photography and £500 from social media posts would need to register as their total exceeds £1,000.
Selling unwanted personal belongings – such as clearing out a wardrobe – does not usually need to be reported to HMRC. But regularly selling goods for profit, or providing a service for payment, is likely to count as trading and may need to be declared.