Up to 300,000 individuals with side jobs, such as online clothes sales or dog walking, will no longer be required to fill out a self-assessment tax return. The government recently announced its plan “to make it easier for Britons to make the most of their entrepreneurial spirit.” This announcement also aims to reduce pressure on HM Revenue & Customs, which has received criticism for its poor customer service, including lengthy wait times on calls. Over 12 million people submitted self-assessment tax forms this year, up from approximately 10 million a decade ago.

Laura Suter from AJ Bell points out that individuals earning money from a secondary job or side hustle will be pleased to hear that the income threshold before needing to file a self-assessment return will triple in the coming years. The government intends to increase the limit to £3,000 per year for “trading income” before requiring a tax return, up from the current £1,000. However, this change doesn’t mean less tax will be paid, only that filing a tax return won’t be necessary until the income reaches £3,000.

Trading income above £1,000 will still be subject to tax, and individuals will be able to pay any owed tax through “a new simple online service.” The existing trading allowance of £1,000 per tax year, which permits earning income without paying tax, remains unaffected by the announcement.

BDO accountancy firm states that instead of filing a return, individuals with side hustles earning between £1,000 and £3,000 per year will pay the amount owed through a simple tax bill or possibly through their PAYE tax code. The government suggests those benefiting from the changes range from individuals selling vintage clothes, dog walking, or gardening, to taxi drivers and social media influencers.

The changes are set to take effect “within this parliament,” which could theoretically mean a wait until 2029.

Source: https://www.theguardian.com/money/2025/mar/15/side-hustles-uk-tax-return