Self-Assessment Reporting Threshold to increase from £1000 to £3000

The government has announced that the Self-Assessment Reporting Threshold will increase from £1000 to £3000, within the next few years.

The goal of this is to reduce complexity and burden for “side hustlers”, such as dog-walkers, people selling on platforms like vinted, and content creators, who are seeing a modest income from non-taxed sources.

Currently, if you earn over £1000 in a year from untaxed income, you’re require to register for Self-Assessment, and complete an annual tax return, even if in subsequent years you earn less than £1000.

But the changes will mean that you won’t need to register for Self-Assessment until you earn over £3000.

That doesn’t mean if you’re earning between £1000 and £3000, there’s no tax to pay, of course, but rather there will be a new simpler way of reporting your income and paying any tax due.

Exchequer Secretary to the Treasury, James Murray announced the planned changes this week in the hope that it will “make it easier for Brits to make the very most of their entrepreneurial spirit. Taking hundreds of thousands of people out of filing tax returns means less time filling out forms and more time for them to grow their side-hustle.”

IPSE data shows revealed that that the number of side hustles in the UK has increased by 20 per cent in the past year, with an additional 77,000 side hustles compared to 2023.

Research from Sage in 2024 showed that nearly 50% of Brits have a “side-hustles” on top of their main job, with 7 in 10 young people juggling multiple income streams, and 9 out of 10 under 34s plan to transition their side hustle into a full-time business.

More recent Adobe data shows over 37% are typically bringing in between £100 and £500 each month from their venture, whilst 20% of Brits are earning £1,000 or more each month.