UK Side Hustle Tax Calculator 2024/25
Calculate your tax obligations for additional income streams. Get instant estimates of Income Tax and National Insurance contributions for your side hustle earnings. All calculations are performed securely in your browser - no sensitive financial information is ever sent to external servers.
Understanding your tax obligations in advance allows you to make informed decisions about setting aside funds. This foresight enables strategic financial planning, whether you choose to safely invest the allocated tax money until payment is due or simply ensure you have the right amount saved.
Important: Income tax bands are different if you live in Scotland.
Latest News: HMRC Urges Side Hustlers to Act Now
Published: 25 June 2025
HM Revenue and Customs (HMRC) has issued fresh guidance encouraging anyone with a side hustle to check whether they need to register for Self Assessment and complete a tax return for the 2024-25 tax year. The tax authority is particularly emphasizing the crucial £1,000 threshold – anyone earning more than this amount from additional income streams, including online selling, content creation, dog walking, property rental, or cryptoasset gains, may need to register for Self Assessment and understand their tax obligations.
HMRC is actively promoting early filing to help taxpayers avoid the traditional January deadline rush. Filing your tax return now provides significant advantages: you'll know exactly what you owe well in advance, can plan your payments strategically, and reduce stress during the busy period leading up to the 31 January 2026 deadline. Importantly, early filing doesn't mean early payment – you still have until the end of January to settle your tax bill, giving you time to manage your finances effectively.
The guidance includes special considerations for higher earners and digital asset holders. Sole traders and landlords with qualifying income over £50,000 need to prepare for Making Tax Digital (MTD) for Income Tax, which comes into effect from April 2026 and will require digital record-keeping and quarterly updates through compatible software. Additionally, the 2024-25 tax year introduces dedicated sections within Self Assessment returns specifically for declaring cryptoassets separately from Capital Gains and Trusts and Estates, reflecting the growing importance of digital assets in the UK economy.
This initiative comes amid concerning statistics revealed by HMRC-commissioned research showing that one in ten people in the UK are operating in the hidden economy, with 65% of these individuals most likely running side hustles while being largely unaware of their tax registration requirements. Myrtle Lloyd, HMRC's Director General for Customer Services, emphasized that understanding tax obligations is essential for anyone earning additional income, stating that early preparation puts taxpayers firmly in control of their financial situation.
Read the full HMRC press release
Understanding Side Hustle Taxes in the UK
When you earn money from a side hustle alongside your main employment, you need to understand how this affects your tax position:
Key Points About Side Hustle Taxation
- The first £1,000 of side income may be tax-free under the Trading Allowance
- Income above this threshold needs to be declared to HMRC
- You'll need to register for Self Assessment if earning over £1,000
- Your side hustle income is added to your main income to determine your tax band
Tax Bands and Rates 2024/25
Your total income (employment plus side hustle) determines your tax band:
- Personal Allowance: Up to £12,570 (0%)
- Basic Rate: £12,571 to £50,270 (20%)
- Higher Rate: £50,271 to £125,140 (40%)
- Additional Rate: Over £125,140 (45%)
National Insurance Contributions
Self-employed individuals may need to pay:
- Class 2 NICs: £3.45 per week (if profits over £12,570)
- Class 4 NICs: 9% on profits between £12,570 and £50,270
- Class 4 NICs: Additional 2% on profits over £50,270
Record Keeping
Maintain accurate records of your:
- Income from all sources
- Business expenses
- Receipts and invoices
- Bank statements related to your side hustle
Frequently Asked Questions
When do I need to register as self-employed?
You should register with HMRC if your side hustle income exceeds £1,000 in a tax year.
What expenses can I claim?
You can claim business-related expenses such as equipment, supplies, travel costs, and a portion of home office expenses if applicable.
When is the tax return deadline?
Self Assessment tax returns must be submitted by January 31st following the tax year end (April 5th).