Blog · Side income

Side income in the UK: what to track, and when HMRC needs to know

By Khorne Projects · 30 October 2026 · about 7 minutes' read

Lots of people earn a bit on the side: selling crafts, reselling clothes, dog walking, tutoring, renting out a driveway. Most of it is small, and most of the rules are simpler than they sound. The tricky part is knowing which money counts, and spotting the point where HMRC needs to hear about it.

This guide covers what to write down, the £1,000 figure to watch, what online platforms now tell HMRC, and when you have to register. It's based on GOV.UK and HMRC guidance, checked on 29 October 2026.

Step 1: Separate selling your own things from trading

Clearing out the loft isn't the same as running a side hustle.

Selling your own unwanted things. GOV.UK says that if you're selling personal possessions, like old clothes, furniture or a phone you no longer use, you probably don't have to pay Income Tax on them. That holds however many items you sell. The exception is anything you sell for more than £6,000, either a single item or a set (like a matching collection). Then you may need to pay Capital Gains Tax, so check GOV.UK.

Trading. HMRC says you're probably trading if you sell things you bought to sell at a profit, or things you made, even as a hobby. Services count too, like gardening, cleaning, food delivery, tutoring or hiring out tools. So does income from creating online content, including gifts you get for promoting products.

If you're not sure which side of the line you're on, GOV.UK has a short tool: Check if you need to tell HMRC about additional income. You can also contact HMRC.

Step 2: Add up all your trading income, before costs

Most people can use a trading allowance of up to £1,000 of tax-free trading income each tax year. Two details catch people out:

It's gross income, not profit. HMRC means the total you took in before any expenses.
It's everything added together. Income from different apps, a local market and cash jobs all goes into one total. HMRC gives the example of someone making £600 selling t-shirts on one platform and £900 selling jackets on another. That's £1,500 in total, so they need to tell HMRC.

The tax year runs from 6 April to 5 April. The current one is 6 April 2026 to 5 April 2027.

If your total gross trading income for the year is £1,000 or less, you usually don't need to tell HMRC. But you do still need to keep a record of it. There are a few exceptions, for example if you made a loss and want to claim relief for it. The trading allowance guidance lists them, along with the cases where you can't use the allowance at all.

If it's over £1,000, you'll need to register for Self Assessment. You can then choose either to take the £1,000 allowance off your income, or to deduct your actual expenses. You can't do both. If your real costs are more than £1,000, deducting them instead would leave a smaller taxable profit. That's one reason to record your costs as you go.

Income from renting out property has its own separate £1,000 property allowance, with slightly different rules. It's covered in the same GOV.UK guidance.

Step 3: Know what platforms tell HMRC

Since 1 January 2024, UK digital platforms (websites and apps that let you sell goods, provide services or rent out property or transport) may have to collect details from sellers and report them to HMRC. That's why your selling app may have asked for your date of birth and National Insurance number.

Here's what GOV.UK says happens:

Platforms report what you earned in each calendar year (January to December) to HMRC by the following 31 January.
They don't report you if you made fewer than 30 sales of goods in the calendar year and received less than €2,000 (about £1,700) for them. This exception only covers selling goods. It doesn't apply to services or rentals.
The platform has to give you a copy of what it reports.

Two things to remember. First, being reported doesn't automatically mean you owe tax. HMRC says the old rules haven't changed: there's no "30 items" tax rule, and the £1,000 trading allowance still applies. Second, the platform's report is no substitute for your own records. It runs January to December, but HMRC works in tax years (April to April), so you'll still need your own figures.

What each platform collects and shares is set out in its own help pages, so for certainty about your account, check your platform's help centre. For the official rules, see GOV.UK's guidance on selling goods or services on a digital platform and its check for income from online platforms.

Step 4: Register by 5 October if you need to

If you need to send a tax return and haven't sent one before (or didn't need to send one last year), you must register for Self Assessment by 5 October after the end of the tax year. For income in the current 2026 to 2027 tax year, that means by 5 October 2027. If you register late, you could get a penalty.

After that, the usual deadlines apply. Online tax returns, and any tax owed, are normally due by 31 January after the 5 October deadline. For the 2025 to 2026 tax year, that's 31 January 2027.

If you're employed, side income isn't sorted out through your payslip. HMRC is clear that telling them about it is your responsibility, not your employer's. Whether you actually owe tax depends on your total income, so it's worth putting a little aside. Our guide to planning for once-a-year bills shows how to do that.

Step 5: Know about Making Tax Digital (but don't panic)

Making Tax Digital for Income Tax means keeping digital records and sending HMRC quarterly updates through compatible software. It applies to sole traders and landlords registered for Self Assessment once their qualifying income goes over a threshold. Qualifying income is your total income from self-employment and property before expenses. Wages from a job don't count towards it.

The thresholds and start dates on GOV.UK are:

over £50,000 in the 2024 to 2025 tax year: from 6 April 2026
over £30,000 in the 2025 to 2026 tax year: from 6 April 2027
over £20,000 in the 2026 to 2027 tax year: from 6 April 2028

Most small side incomes are well below these figures. But if yours is growing, check whether and when you need to use it.

Step 6: Keep simple records, and keep them long enough

Whatever your side income, GOV.UK says to keep records. If you're self-employed, that means records of all sales and income and all business expenses, along with proof such as receipts, bank statements and invoices. If you're using the trading allowance, you still have to keep a record of your income. HMRC's examples include a spreadsheet of your income receipts, emails confirming payments and bank statements.

We'd suggest this as a minimum for each entry:

the date you were paid
what it was for, and where (which app, market or customer)
the gross amount, plus any platform fees taken off
your expenses, with a note of whether you kept the receipt

How long to keep them: if you're self-employed, GOV.UK says at least 5 years after the 31 January submission deadline for that tax year. Its example: if you sent your 2022 to 2023 return online by 31 January 2024, keep your records until at least the end of January 2029.

Then check in once a month. Note your running total against the £1,000 figure, so you see it coming rather than finding out in April.

Tools: free and paid

You don't need to buy anything for this. A notebook or a basic spreadsheet does the job. Our free UK Monthly Money Snapshot includes a simple income log for one month.

If you'd like the whole tax year set up for you, we made the UK Side Income & Expenses Tracker 2026/27 (£4.50). It covers 6 April 2026 to 5 April 2027, with an income log that records platform fees, an expenses log with a "receipt kept?" column, and automatic totals for each of the 12 tax months. A tax-year summary compares your gross income with HMRC's £1,000 trading allowance figure, and tells you when to check GOV.UK about Self Assessment. It works in Excel, Google Sheets and LibreOffice. It's a record-keeping tool, so it doesn't work out your tax. But the habit matters far more than the tool.

See the Side Income Tracker (£4.50)

Useful official links

This is general information, not financial, tax or benefits advice. Rules can change, so check the linked official pages for your own circumstances. Written by Khorne Projects with AI assistance, and checked against the official sources above on 29 October 2026.

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