HMRC sets October 5 deadline for anyone making money on side hustles

The deadline for registering for self assessment is fast approaching and those who made thousands on a second job must act quickly

Britons who have earned at least £1,000 from side hustles are being advised to action October 5. HM Revenue & Customs (HMRC) recently issued a reminder for individuals to check if they need to register for self assessment by this date.

In a post on their X page, the tax office advised those who were self-employed or had made substantial earnings from side hustles to take immediate action. No specific consequences were mentioned for missing the deadline, although current regulations stipulate that those who fail to submit a tax return by the end of the following January will face penalties.

“Check if you need to register for #SelfAssessment for the first time by 5 October,” read the message from HMRC. “You might need to if you: Have earned more than £1,000 through a side-hustle, are self-employed, [or] rent out a property. Find out more.”

Side hustles have become an increasingly popular method for workers to earn additional income on top of their regular jobs. According to price comparison site Finder.com, about two-fifths of the population (39 per cent) have earned money on the side, with more men (49 per cent) having an extra source of income compared to women (37 per cent).

The research also suggested that the average income from side hustles is £210 a week or £914 a month, while a third (35 per cent) had made about £20 a week or more on average. The most popular side hustles included selling old clothes on Vinted, having a part-time second job, or becoming a social media influencer.

However, financial experts have cautioned that those with side jobs could be at risk of handing over a significant portion of their earnings to the taxman. Money transfer service Remitly advised on their website: “Many new side hustlers underestimate tax calculations. Consider setting up a separate savings account for tax contributions and tracking allowable expenses to reduce your bill. You may also need to register for Self Assessment with HMRC.”

Typically, tax is automatically deducted from workplace salaries and pensions through the pay as you earn (PAYE) system. However, if you have additional income sources, you might need to submit an annual tax return.

In addition to the three scenarios mentioned in HMRC’s X post, its website also outlined several other situations where you might need to complete a tax return:

• You were required to pay Capital Gains Tax when you sold or ‘disposed of’ something that increased in value
• You had to pay the High Income Child Benefit Charge
• You received money from renting out a property
• You received tips and commissions
• You received income from savings, investments and dividends
• You received foreign income
• You were self-employed as a ‘sole trader’ and earned more than £1,000 (before deducting anything you can claim tax relief on).
• You were a partner in a business partnership
• You had a total taxable income of more than £150,000

If you register after October 5 and fail to submit a tax return within three months, you could be hit with a late filing penalty of £100, in addition to the following:

• After three months, additional daily penalties of £10 per day, up to a maximum of £900
• After six months, a further penalty of five per cent of the tax due or £300, whichever is greater
• After 12 months, another five per cent or £300 charge, whichever is greater

People can complete a Self Assessment form by visiting Gov.uk or by posting a paper copy, reports the Express. For the paper option, you’ll need to request ‘form SA100’ by ringing the HMRC hotline on 0300 200 3310.