A Tip on Tax

A Tip on Tax

Extra income is all very well, but don't forget the taxman will want his share. Any sources of extra income need to be declared. So make sure you're upfront with HM Revenue & Customs.

It's important to let HMRC know you're self-employed as soon as possible, either via the HMRC website or by calling 0300 200 3504. If you don't tell them, you may have to pay a penalty. You'll also get a £100 penalty if you fail to meet the deadlines for self-assessment: 31 October for paper forms, and 31 January for electronic submissions .

For full information, read HMRC's self-employment leaflet. Also, don't forget to make full use of your personal allowances: depending on what your other job status is and your age, the first £11,850 of any income is tax-free in the 2018/19 financial year.

If you spend money on items for your business, be sure to keep the receipts. They're tax-deductible. See the HMRC website for a full breakdown of what you're entitled to.

The Government's recently introduced a new tax break which means since 6 April 2017, the first £1,000 you earn each year 'trading' is tax-free.

Basically this means you no longer have to report the first £1,000 you make from selling goods and casual services, such as babysitting and gardening, whether online or offline. See the £1,000 tax breaks will be back in new finance bill MSE news story for more info, andGov.uk for full details.