HMRC issues new £3,000 allowance for thousands of people

HMRC announced an increase in the Income Tax Self Assessment (ITSA) reporting threshold from £1,000 to £3,000 on March 11. Up to 300,000 people, including those with side hustles, will no longer need to file a Self-Assessment tax return. This includes people trading clothes online, dog-walking or gardening on the side, driving a taxi, or creating content online.

This will benefit around 300,000 taxpayers. An estimated 90,000 of them will have no tax to pay and no reason to report their trading income to HMRC in the future at all.

Others will be able to pay any tax they owe through a new simple online service.

Exchequer Secretary to the Treasury, James Murray said: "From trading 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.

"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."

Mr Murray, the minister responsible for HMRC, announced this reform on March 11 to tax experts hosted by the Chartered Institute of Taxation and the Institute of Chartered Accountants in England and Wales in a speech to mark the 20th anniversary of HMRC.

Eve Williams, CEO of eBay UK, commented: "This will be welcome news for thousands of UK sellers for whom eBay is a side hustle and a means of supplementing their household income during challenging times.

"By removing the paperwork associated with selling online, hopefully we will help these side hustles grow into fully fledged small businesses."

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