Self Assessment Changes for UK Side-Hustlers

The UK government has introduced a major change to the Self Assessment tax threshold, making tax reporting simpler for many people earning extra income. If you have a side hustle, do freelance work, or sell online, you’ll want to pay attention to this update!

What’s Changing?

The tax-free trading allowance is increasing from £1,000 to £3,000.

Previously, individuals earning more than £1,000 from self-employment, side gigs, or online sales had to file a Self Assessment tax return. Now, that threshold has tripled to £3,000, meaning approximately 300,000 taxpayers will no longer need to file.

Who Does This Affect?

If you earn extra money from:
✅ Online marketplaces (e.g., selling on Vinted, eBay, Etsy, or Depop)
✅ Freelancing (e.g., writing, graphic design, consulting)
✅ Gig economy work (e.g., Uber, Deliveroo, TaskRabbit)
✅ Other self-employed income

… then this change directly impacts you!

What It Means for You

🔹 Earning under £3,000 a year from side income?
You won’t need to file a Self Assessment tax return anymore. That means less paperwork and fewer tax worries!

🔹 Earning over £3,000?
You still need to file a Self Assessment and report your income. However, you should check whether you qualify for deductions or tax reliefs that could reduce your taxable income.

Why Is HMRC Making This Change?

This adjustment is part of a larger effort to simplify tax reporting in the UK. With increasing numbers of people earning income through side hustles and online platforms, HMRC aims to reduce the administrative burden on taxpayers and improve compliance.

In addition, HMRC is introducing a new service to assist accountants and taxpayers with older Self Assessment and PAYE queries, making tax administration more efficient.

What’s Next?

Expect more changes in the coming months as HMRC continues to reform the tax system. If you’re making money outside of traditional employment, it’s important to stay informed about new tax rules that might affect you. To see more official updates on this topic, visit this gov.uk link

Final Thoughts

This new £3,000 threshold is great news for many small-scale side hustlers, but if you earn above the limit, you still need to stay tax-compliant. Whether you’re new to self-employment or a seasoned freelancer, keeping track of your earnings and understanding your tax obligations is key.

📌 Need help with your Self Assessment or tax planning? Contact me, Salome (Tax Accountant and Financial Wellbeing coach) on [email protected] for expert guidance on managing your taxes efficiently!

🔄 Share this article with a fellow side hustler who needs to know!