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The £3,000 Side Hustle Threshold: Not in Force Yet
Last checked against GOV.UK and HMRC: 26 October 2026 · General information, not tax advice
The short answer: the £3,000 threshold is not in force, and it isn't a tax-free allowance. The government has announced plans to raise the Self Assessment reporting threshold for trading income from £1,000 to £3,000 at some point in this Parliament. Today, the rule is still: over £1,000 of gross trading income in a tax year, tell HMRC.
What was announced
On 11 March 2025 the Treasury announced plans "to increase the Income Tax Self Assessment (ITSA) reporting threshold for trading income, from £1,000 to £3,000 gross within this parliament" (GOV.UK press release). It said up to 300,000 people would no longer need to file a return, that an estimated 90,000 of them would have no tax to pay, and that others would be able to pay any tax they owe through "a new simple online service".
A written ministerial statement on 28 April 2025 confirmed the plan: the threshold would rise to £3,000 gross, and "These changes will be implemented within this Parliament" (UK Parliament: HCWS607).
What it would change, and what it wouldn't
| Gross trading income in a tax year | Rule today | Planned rule, once in force |
|---|---|---|
| £1,000 or less | Covered by the trading allowance; usually no need to tell HMRC | No change announced |
| Over £1,000 up to £3,000 | Register for Self Assessment and file a return | Tell HMRC and pay any tax through a new online service instead of a full return |
| Over £3,000 | Register for Self Assessment and file a return | No change announced |
The key point: the planned change is about how you report, not how much is tax-free. HMRC's Help for Hustles site answers the myth directly. Asked "I heard that I don't need to do anything until I'm earning over £3,000?", it says: "That's not true. If you're earning over £1,000 from side hustles, you'll still need to tell HMRC." It adds that "a new online reporting tool is on the way by 2029" (HMRC: Help for Hustles).
It's not the platform reporting rule either
Another figure often mixed up with this: platforms like Vinted, eBay and Depop report sellers to HMRC after 30 sales or about £1,700 (€2,000) in a calendar year (GOV.UK). That's a separate rule about what platforms tell HMRC, and it hasn't changed because of the £3,000 announcement. HMRC also says the tax rules themselves haven't changed: you've been able to make up to £1,000 a year tax-free from side hustles since 2017 (HMRC).
What to do now
- Selling your own unwanted things? This usually isn't trading at all. See our Vinted tax guide.
- Buying to resell, or making things to sell? Add up your gross income from all side hustles for the tax year (6 April to 5 April). If it's over £1,000, follow our Self Assessment guide: for the 2025 to 2026 tax year, online returns and payment are due by 31 January 2027 (GOV.UK).
- Keep records either way. If the new service arrives, you'll still need to know your income and costs. Our free profit tracker helps.
Budget 2026
The Budget is on 28 October 2026, and HMRC says full details of its tax announcements will be published that day (GOV.UK: Budget 2026 tax documents). When we checked on 26 October 2026, no start date for the £3,000 threshold had been published. We'll re-check this page after the Budget.
Quick answers
Can I earn £3,000 from a side hustle tax-free?
No. The £3,000 figure is a planned Self Assessment reporting threshold, not a tax-free allowance, and it isn't in force. The tax-free trading allowance is still £1,000. HMRC says that if you earn over £1,000 from side hustles, you still need to tell it.
When does the £3,000 Self Assessment threshold start?
No start date has been set in legislation. The government said in 2025 that the change would happen within this Parliament, and HMRC's Help for Hustles site says a new online reporting tool is on the way by 2029.
What would the £3,000 change mean?
People with gross trading income between £1,000 and £3,000 would no longer have to file a full Self Assessment return. They would still have to tell HMRC and pay any tax owed, using a new simpler online service.
Not sure where you stand?
- Use HMRC's free tool: Check if you need to tell HMRC about additional income.
- Read GOV.UK's guide to telling HMRC about income from online platforms.
- Speak to an accountant or tax adviser. If you're on a low income, the charity TaxAid gives free tax help.
Where are you against the £1,000? Our free checker shows where you stand against each platform's reporting rule and the £1,000 trading allowance. No sign-up, and nothing you type leaves your device.
Open the free HMRC limit checker Join the SideLedger waitlistSources
- GOV.UK: Boost for side-hustlers as 300,000 people to be taken out of tax returns (11 March 2025)
- UK Parliament: Written statement HCWS607 (28 April 2025)
- HMRC: Help for Hustles and Tax rules for selling things
- GOV.UK: Tax-free allowances on property and trading income
- GOV.UK: Selling goods or services on a digital platform
- GOV.UK: Self Assessment deadlines and Budget 2026 tax documents
More guides for UK online sellers
- Do You Pay Tax on Vinted? UK Rules & HMRC Limits 2026 – Own clothes vs reselling, the £1,000 allowance and the 30-sale reporting rule, in plain English.
- Vinted HMRC Form & NI Number Request: What to Do – Why Vinted is asking for your National Insurance number, the end-of-year deadline, and why it doesn't mean you owe tax.
- Vinted Tax Calculator UK: Free HMRC Limit Checker – Check your sales against the 30-sale / ~£1,700 reporting rule and the £1,000 allowance. It checks limits; it doesn't work out a tax bill.
- eBay HMRC Reporting Threshold 2026: £1,707 or 30 Sales – What eBay counts towards £1,707, what it reports, and why a report isn't a tax bill.
- Got an HMRC Letter About Vinted or eBay Sales? What to Do – A calm step-by-step: check it's genuine, work out if you were trading, and reply on time.
- Free Vinted & eBay Profit Tracker Spreadsheet (UK) – A free download with tax-year tabs, profit per item and a check against the HMRC limits.
- Trading Allowance vs Expenses: Which Should Resellers Use? – The £1,000 allowance or your real costs? Why resellers who track stock costs often come out ahead with expenses.
- Do Resellers Need to Register for Self Assessment? – When reselling counts as trading, the £1,000 rule, and the 5 October and 31 January deadlines.
- Depop HMRC Reporting: Do You Pay Tax on Depop Sales? – What Depop reports, what it asks you for, and Depop's own example of being reported but owing no tax.
- Etsy UK Tax: HMRC Reporting Rules for Sellers 2026 – When Etsy reports you to HMRC, and why things you make to sell usually count as trading.