ANYONE who has a side hustle or second job has just one week left to act or risk a big fine.
The deadline for filing your self-assessment tax return by post is October 31.
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You should have already registered as a self-assessment taxpayer if you have a side hustle or second income.
It is how you let HM Revenue & Customs (HMRC) know you will be completing a tax return.
The deadline for filing your paper tax return is October 31.
If you miss the deadline by up to three months you will be charged a £100 penalty.
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If you miss it by more than three months you will be charged more on top of this.
If you don’t manage to fill out your paper form on time you can fill out your tax return online.
You must file your electronic tax return online by January 31, 2024.
The late filing fees are pretty hefty for filing your taxes late so make sure to get your assessment return in before January 31.
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According to HMRC, as well as the £100 initial fine, you will also be charged a daily fine of £10 for each day you do not submit your return.
This is capped at 90 days – or £900 which means that you could end up paying a maximum fine of £1000.
If you are six months late there is a further £300 fine or 5% of the money you owe – whichever is higher.
After 12 months, another £300 or 5% applies and interest is also added on top of this.
If you deliberately haven’t filed your tax return, a fine of up to 100% of the tax due could then be sent too.
Other things you need to know if you have a side hustle
There is a huge change to tax rules that people who have a side hustle need to know about.
Whether you rent out your home, drive for Uber or do a bit of freelancing on Fiverr, your income will soon be reported directly to HMRC.
From January 1, HMRC will direct these platforms to record how much money people make by selling their services on them.
It is part of a big crackdown by HMRC on people boosting their incomes via side hustles.
People who have a side hustle will still be expected to fill in a tax return and pay what they owe HMRC every year.
The changes are in a bid to “bear down on and tackle tax evasion”.
Seb Maley, chief executive of tax insurance provider for self-employed workers, Qdos, said the legislation will have “big implications” for people who have a side hustle as a second income.
He added: “The crux of it is that HMRC doesn’t trust the growing number of people with side hustles in the UK to accurately report how much money they’re making this way.
“So the tax office will go directly to these platforms, who will become responsible for recording this information and handing it over to HMRC.”
If you do lie about your income to HMRC you could face serious fines.
How do you know if you need to submit a tax return?
Tax is usually deducted automatically from wages, pensions and savings.
But people and businesses with other incomes must report it in a tax return to HMRC.
This applies to the following:
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- Your income from self-employment was more than £1,000
- Earned more than £2,500 from renting out property
- You or your partner received high-income child benefits and either of you had an annual income of more than £50,000
- Received more than £2,500 in other untaxed income, for example from tips or commission
- Are limited company directors
- Are shareholders
- Are employees claiming expenses in excess of £2,500
- Have an annual income over £100,000
If it is the first time you have filled in a tax return we have a step-by-step guide that can help you.
