Side-hustle tax in the UK (2026): what you owe and when to tell HMRC
If you earn money doing tasks, this is the part people get wrong. It is simpler than it looks.
The £1,000 trading allowance
You can earn up to £1,000 gross from self-employment in a tax year (6 April to 5 April) without telling HMRC anything. Gross means before you deduct any costs.
Over £1,000 and you must register for Self Assessment and file a return. You still may not owe tax, as your personal allowance still applies, but you must file.
Platforms now report your earnings to HMRC
Since January 2024, UK digital platforms are legally required to collect seller information and report annual earnings to HMRC, with a copy to you each January. This is why any legitimate platform asks for your name, address, date of birth and National Insurance number before your first payout.
Two consequences:
- HMRC already knows. Not declaring is no longer a grey area.
- The reported figure is gross. It is the total the customer paid, before the platform's fee. Your taxable profit is lower, but only if you claim your costs, which means keeping records.
Note that unlike goods, services have no 30-sales or €2,000 exemption. All service earnings are reportable.
Registering
Register at gov.uk by 5 October following the end of the tax year in which you passed £1,000. Miss it and there are penalties. You get a UTR number, then file online by 31 January.
What you can deduct
Only costs "wholly and exclusively" for the business:
- Platform fees and payment processing.
- Tools and equipment (small items outright; larger items via capital allowances).
- Materials and consumables.
- Mileage at 45p per mile for the first 10,000 miles, then 25p. Keep a log, as this is usually the biggest single deduction.
- Public liability insurance, DBS checks, trade memberships.
- A proportion of your phone bill.
- Working-from-home flat rate if you do admin at home.
You cannot deduct ordinary commuting, clothing that is not protective, or fines.
Two ways to work it out
Trading allowance method: deduct a flat £1,000 from your gross income instead of your actual costs. Simpler, and better if your real costs are under £1,000.
Actual costs method: deduct what you really spent. Better once you have a vehicle, tools and materials.
You choose per tax year, whichever gives the lower profit. You cannot use both.
National Insurance
Class 4 NI is due on profits above the lower profits limit, calculated automatically in your return. Class 2 has changed in recent years, so check the current position when you file. If your profits are low you may want to pay voluntarily to protect your state-pension record.
VAT
Only if your taxable turnover passes £90,000 in any rolling 12 months. Most taskers never approach this. If you do, register within 30 days of the end of the month in which you passed it.
A record-keeping routine that takes five minutes a week
- One bank account (or at least one card) used only for the business.
- Photograph every receipt into one phone album.
- Download your platform earnings statement monthly.
- Log mileage as you go, not in January.
Keep records for at least five years after the 31 January filing deadline.
How Taskerama makes this easier
Taskerama collects the details the reporting rules require once, before your first payout, and gives you a yearly earnings statement you can use for your return. Every fee is itemised on every job, so the platform fees you can deduct are already recorded for you. You can download your earnings at any time from your dashboard.
Want to start earning with the paperwork handled cleanly? Become a tasker.
This is general information, not tax advice. Check gov.uk or speak to an accountant about your own circumstances.
Primary sources
Everything above is drawn from these. They are the versions to trust if we have fallen out of date.
Frequently asked questions
Do I need to declare side-hustle income under £1,000?
No. The trading allowance lets you earn up to £1,000 gross from self-employment in a tax year without registering. Above that you must register for Self Assessment.
Do task platforms report my income to HMRC?
Yes. Since January 2024, UK digital platforms must collect seller details and report annual earnings to HMRC, sending you a copy each January. Services have no minimum-transaction exemption.
What can I claim as expenses?
Platform fees, tools, materials, mileage at 45p per mile for the first 10,000 miles, insurance, DBS checks and a share of your phone bill: anything wholly and exclusively for the work. On Taskerama your platform fees are itemised on every job and in your earnings statement.
Related guides
- What platforms report to HMRC about you (and why the number looks too big)Since January 2024 UK platforms must report your earnings to HMRC. What data they collect, why services have no minimum-sales exemption, what your January statement shows, and what to do if the figure looks wrong.
- Right to work checks and self-employed work in the UK: what applies to youWho can work self-employed in the UK, how you prove it, the reported extension of right-to-work checks to gig work, and how it differs from DBS, trade registration and waste carrier checks.
- Do you need public liability insurance for task work in the UK?What public liability covers, what marketplace protection does not, typical costs for handymen and cleaners, and how to show you are insured on Taskerama.
- How to register as self-employed in the UK: the deadlines and the stepsWhen you must register with HMRC, the 5 October deadline, getting a UTR, filing by 31 January, National Insurance, and what changes at the £90,000 VAT threshold.
Prices and rules change. If something here is out of date, tell us and we will fix it. How we research and check these guides.