HMRC has issued a pre-Christmas reminder to anyone making extra money from festive crafts, market stalls and other seasonal side hustles to check whether their earnings are taxable.
HMRC’s Help for Hustles campaign is aimed at individuals who supplement their standard income with small-scale trading.
With a particular focus on the all-important £1,000 trading allowance.
If your total side income exceeds £1,000 in any tax year, you typically need to register for Self Assessment, file a tax return by the end of January in the following year, and pay any tax due.
For the 2024-2025 tax year, for example, if you earned more than £1,000 from side hustles, you may need to register and file by January 31st 2026.
The £1,000 limit applies to all types of trading activities, so a mix of craft sales, market stalls, online selling, and content creation will all contribute towards the threshold.
When festive selling tips over into taxable trading
In its campaign release, HMRC draws a clear line between simple decluttering and genuine trading. Selling the odd unwanted item from your loft or wardrobe will not usually be taxable.
Making Christmas decorations to sell, upcycling furniture for profit, or running a seasonal market stall is a different matter – as it’s clearly a business activity, even on a small scale.
Kevin Hubbard, HMRC’s Director of Individuals and Small Business Compliance, said:
Whether you’re making handmade Christmas decorations, selling upcycled furniture, or running a seasonal market stall, it’s important to understand when your festive side hustle becomes taxable trading
HMRC’s guidance also highlights that the allowance is based on gross income, not profit.
Their example of someone earning £600 from craft sales and £500 from content creation illustrates how easily you can exceed the limit.
Once the combined total reaches £1,100, the person would typically need to notify HMRC and may be required to submit a Self Assessment return.
Try this free online checker on the Help for Hustles site.
Markets, platforms and the £1,000 trading allowance
Alongside traditional markets, HMRC is also reminding people that online platforms are now obliged to share data on sellers that pass certain thresholds.
This follows earlier changes that require platforms to report details of users who make 30 or more sales and earn approximately £1,700 per year.
We have covered these new platform reporting rules, and how they affect people with online side hustles, in more depth here: HMRC gets new powers to see side hustle income from online platforms.
These online reporting rules do not alter the underlying tax law, but they do provide HMRC with greater visibility into individuals who regularly sell goods or services.
What ByteStart readers should do now
If you are making money from Christmas crafts, pop-up stalls, Etsy orders or selling other items on the side, it is worth checking three things as the festive season approaches:
- Are you genuinely just selling your own unwanted belongings, or are you making or buying items to sell at a profit?
- Has the income become regular, rather than a one-off clear-out?
- Have your total side earnings from all sources gone over £1,000 during the tax year?
If you are close to or above the £1,000 mark, read ByteStart’s full guide to the trading allowance and how it works in practice: What is the £1,000 trading allowance and how does it work.
The next step is to use HMRC’s checker on the Help for Hustles site and then register for Self Assessment if needed.
For readers who are thinking about turning this year’s successful festive stall or online shop into a more permanent business, our sole trader tax guides explain how the wider tax system works once you are fully up and running.
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