HMRC Reminds Christmas Side Hustle Sellers to Check Tax Obligations for 2024-25 and 2025-26
HMRC's Help for Hustles campaign highlights the importance for those earning extra income from Christmas stalls or online sales to be aware of their tax obligations.
If earnings exceed the £1,000 trading allowance for the 2024-25 tax year, individuals must register for self-assessment as sole traders and file a tax return, with tax due by 31 January 2026. Earnings from the 2025-26 tax year, including this Christmas season, should also be declared and any tax paid by 31 January 2027.
The £1,000 trading allowance applies collectively to all trading activities and is calculated before expenses. The personal allowance of £12,570 per year allows individuals to earn this amount tax-free.
Allowable expenses related to the side hustle, such as office and website costs, can be deducted. It is important to distinguish between selling personal items, like decluttering which usually is not reportable, and trading activities that may be taxable.
Online content creators and influencers must also include income from gifts or services received for promotion in their taxable earnings—for example, £700 paid, £300 worth of gifts, and £200 from ads totaling £1,200.
Full records of all sales, income, and business expenses should be kept, including invoices, receipts, and bank statements, to comply with HMRC requirements.
