UK Government Announces Tax Break for Side Hustlers Earning Below £3,000

March 11, 2025

By Evans Momodu
2 minute read
Published 17:21 UK GMT

Stepping away from trade news for a moment, the UK government has just announced a major tax update that will benefit thousands of self-employed individuals and side hustlers.

People earning less than £3,000 per year from their side hustle will no longer need to complete a self-assessment tax return, simplifying the tax process for small-scale entrepreneurs and freelancers.

Instead of navigating the complex self-assessment tax return system, individuals earning up to £3,000 annually from self-employed work will be able to declare their income using a new, straightforward online tax declaration form.

Treasury Minister James Murray confirmed the update ahead of the official announcement, stating:

“From selling old games to creating content on social media, we are changing the way HMRC works to make it easier for Brits to make the very most of their entrepreneurial spirit.”

He added that this change would remove the tax return burden for hundreds of thousands of people, allowing them to focus on growing their side hustle rather than worrying about tax paperwork.

While the new system simplifies tax filing, it does not change the amount of tax owed. Individuals who earn above the £3,000 threshold will still need to submit a self-assessment tax return as usual.

Current UK Side Hustle Tax Rules

Under £1,000 per year – No need to declare or pay tax.
Between £1,000 and £3,000 per year – A new online form will replace the traditional tax return.
Over £3,000 per year – A self-assessment tax return is still required.

Under current tax regulations, anyone earning more than £1,000 per year from side jobs such as social media content creation, selling handcrafted items, dog walking, or online reselling is required to declare and pay tax on their income.

This latest announcement from HMRC is seen as a win for gig economy workers, casual freelancers, and entrepreneurs looking to earn extra income without being bogged down by complex tax processes.
Source: Sky news
Image: UK Property Accountants