Tax Planning
Streamlining Self-Assessment: What Britain's Side Hustlers Need to Know
The UK raised the Self Assessment threshold for trading income to £3,000—relieving many side hustlers from returning forms while offering new reporting routes. Here’s how it works.
By NomadicTax Research Team • 5-8 min read • November 15, 2025
## What’s New?
- The government announced that within **this Parliament**, the reporting threshold for **trading income** under **Self Assessment** will increase from **£1,000** to **£3,000 gross**. ([gov.uk](https://www.gov.uk/government/news/boost-for-side-hustlers-as-300000-people-to-be-taken-out-of-tax-returns-government-announces?utm_source=openai))
- This change will align thresholds for “trading”, “property” and “other taxable” income, each set at £3,000 gross. ([gov.uk](https://www.gov.uk/government/publications/summary-of-tax-update-spring-2025-simplification-administration-and-reform/tax-update-spring-2025-simplification-administration-and-reform-summary?utm_source=openai))
- As a result, up to **300,000 taxpayers** will no longer be required to file Self Assessment returns—many of them ‘side hustlers’ or those with small-scale additional income. ([gov.uk](https://www.gov.uk/government/news/boost-for-side-hustlers-as-300000-people-to-be-taken-out-of-tax-returns-government-announces?utm_source=openai))
## Who Benefits Most
- Individuals earning incidental income from online sales, gig work, content creation, dog walking or other casual trading — especially those under the new £3,000 gross threshold.
- Taxpayers who previously had to file a return for side income even when tax due was negligible.
- Those who prefer simpler compliance and less paperwork.
## What Remains Obligatory
- Income above the threshold still needs to be declared; any tax due must be paid. The threshold doesn’t exempt from tax liability—it just relaxes reporting requirements.
- Other substantial sources of income—like employment income, rental income, or business profits—still need correct reporting.
- The Self Assessment return may still apply if HMRC requests it, for example under enquiry or where income is complex.
## Implications for Action
- If your side income is below £3,000 gross, **you may no longer need to file a Self Assessment return**, freeing up time and resources.
- However, keep **records** of gross income even if under the threshold. In case of audits or if income spikes.
- If income crosses £3,000, consider using HMRC’s online reporting services. Officials say a new simpler online service is coming for those who exceed threshold. ([gov.uk](https://www.gov.uk/government/news/boost-for-side-hustlers-as-300000-people-to-be-taken-out-of-tax-returns-government-announces?utm_source=openai))
## Real-Life Example
Sarah makes ~£2,500/year selling handmade crafts online and walks dogs in her spare time. Under old rules (threshold £1,000), she needed to file Self Assessment — but with the new £3,000 threshold, she’d be **exempt from filing**, unless she has other reportable income.
Tom runs a small tutoring side business making £4,000/year but also earns rent from a property. He’ll still file, since his trading income exceeds the threshold, and his property income adds complexity. He may use simplified reporting where available.
## Cautions & Watch Points
- Just because you don’t need to file doesn’t mean you **don’t owe tax**. HMRC may contact if you haven’t reported income they think you should.
- Threshold alignment means property income and other taxable income also have £3,000 gross reporting limits—watch combined income sources.
- If using the new simpler service, check for deadlines, portal opening dates, and any data you’ll need to provide.
## Summing Up
The uplift to £3,000 gross offers welcome relief for side hustlers and casual earners. Less form-filling, more clarity, and lower barriers to compliance. But if your income edges past that line, or income is mixed, you’ll still need to do right by HMRC—and professional advice helps with that.