Tax Planning
Thriving Under £3,000: How Side Hustlers & Self-Employed Benefit from New Filing Thresholds
Examining the major change raising the income threshold for Self Assessment filing to £3,000 gross, and how casual traders, content creators, and gig workers can benefit.
By NomadicTax Research Team • 5-8 min read • November 23, 2025
## What’s Changing
As part of the government’s **Plan for Change**, the **Income Tax Self Assessment (ITSA)** reporting threshold for trading, property, and "other taxable" income is being aligned to **£3,000 gross** each. If your income from any of those streams falls below £3,000, you may no longer be required to file a full Self Assessment tax return. ([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))
Up to **300,000 taxpayers**, many of them “side hustlers”—online sellers, gardeners, rideshare drivers—will benefit. Around **90,000** of them currently have little to no tax liability. ([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))
## Operational Implications
- **Tax reporting**: Even though the filing requirement may be removed, a **new digital reporting option** will be offered. You may still choose to stay in Self Assessment voluntarily. ([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))
- **Tax liability**: This change doesn’t alter the tax rates or allowances. If taxable income exceeds the new thresholds—or if multiple streams push you above—it’s still necessary to report.
- **Deadlines & software**: If you're near or crossing the threshold, ensure record-keeping and filing systems are ready. Use software to track all income sources accurately.
## Examples
1. **Emma**, a social media content creator, earns £2,500/year from sponsorships and merch. Under the new rules, she’ll no longer need a Self Assessment return for that income alone—and can use the simpler digital service instead.
2. **Ben**, who drives part-time and tutors online, earns £4,000 from tutoring, £2,500 from driving, and £500 from selling art. Since one stream (tutoring) exceeds £3,000, he still needs to file.
## Best Practices Going Forward
- Consolidate incomes from different sources and check cumulative income against thresholds.
- Track your income year-round using tools or apps—don’t wait until deadline season.
- Use the digital reporting service when suitable and remain aware of upcoming dates.
- For those slightly under the limit, understand whether remaining in Self Assessment brings benefits (e.g., claiming expenses).
## Strategy Tips
- **Expense claims**: If you have allowable expenses tied to your small income stream, being in Self Assessment may still make sense.
- **Separating income types**: Different streams (property, trading, investment) have different thresholds and rules.
- **Record thresholds from Spring Budget and Autumn Budget**: Changes may come incrementally—stay updated with draft legislation.
Overall, the new £3,000 gross threshold represents a relief from unnecessary reporting, especially for low-income self-employed individuals and side hustlers. It lowers administrative burdens while ensuring those with significant income and tax obligations continue to file properly. Preparation, good record-keeping, and awareness are key to making the most of this shift.