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Up to 300,000 people, including those with side hustles, will no longer need to file a Self-Assessment tax return, tax minister James Murray is expected to announce in a speech later today.
This includes people trading clothes online, dog-walking or gardening on the side, driving a taxi, or creating content online.
As part of a bold new package to transform HMRC into a quicker, fairer and more modern body the minister is expected to announce plans to increase the Income Tax Self Assessment (ITSA) reporting threshold for trading income, from £1,000 to £3,000 gross within this parliament.
This will help deliver the Plan for Change by freeing up time for taxpayers helping to create the conditions for economic growth.
This will benefit around 300,000 taxpayers. An estimated 90,000 of them will have no tax to pay and no reason to report their trading income to HMRC in the future at all.
Others will be able to pay any tax they owe through a new simple online service. The changes reflect the government’s commitment to driving forward efficiency reform, a key component of its Plan for Change.
Newspage asked business owners and financial services experts for their views, below.
Patricia McGrirr, founder at Repossion Rescue Network said, “At last, a tax change that actually makes sense. Less pointless paperwork, more time for people to crack on with earning a living. This is great news for side hustlers, and a relief for HMRC staff no longer rummaging down the back of the fiscal sofa for pennies.
“But let’s not get carried away. Is this a genuine step towards a fairer, simpler tax system or just a sticking plaster for an overstretched HMRC?
“Will the £3,000 threshold be a genuine safety net or a snare, quietly pulling more people into scrutiny later? And if cutting red tape is such a revelation, why stop here? What about landlords, sole traders, and everyone else bogged down in the tax quagmire?
“Fewer tax returns is a win. But a tax system that actually works for the working people paying it? That would be a miracle. Let’s see if they can manage that next.”
Faisal Sheikh, managing director at Monmouth Capital said, “Well done – and let’s hope this is the first of many such measures.
“This is the kind of thing the Office for Tax Simplification was meant to help deliver. Although it’s very unfashionable in the era of DOGE to propose setting up a new government agency, this is one that I would love to see come back, as long as it is taken seriously this time.”
Gabriel McKeown, head of macroeconomics at Sad Rabbit added, “The planned increase in the Self-Assessment reporting threshold is long overdue and will allow small-scale entrepreneurs to focus on growing their ventures rather than navigating unnecessary bureaucratic hurdles.
“This reform is a welcome surprise after endless anti-growth policies, as this could unlock notable economic benefits by encouraging individuals previously deterred by reporting complexity to either initiate or expand their side ventures.
“However, the success of this initiative will depend not only on legislative intent but on pragmatic execution and will require HMRC to swiftly adapt and effectively administer the new simplified online system.”
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