The £1,000 freebie
Lesson 2 of 12 in our free Side Hustles & Self-employment guide: a 5-minute money game with the key points below.
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Free with a code from your uni, college, council, landlord or employer (worth £600/year). Lesson 1 of Side Hustles & Self-employment is free for everyone.
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Questions you'll answer
You earn £3,000 from a cake business with £400 of ingredient costs. Which gives the lower taxable profit?
Jas earns £4,500 from tutoring and her costs are £1,300. Using whichever option is better, what's her taxable profit?
Quick facts
- Mo: £340 from dog walking all year → Under £1,000 — usually nothing to report. Well under £1,000 of income. Covered by the trading allowance.
- Jas: £2,400 from nail appointments → Over £1,000 — needs reporting. Over £1,000 of income — time to register for Self Assessment.
- Sam: £950 from selling handmade earrings → Under £1,000 — usually nothing to report. Just under. Close one, though — keep tracking it.
- Priya: £1,600 income, £700 costs (£900 profit) → Over £1,000 — needs reporting. The allowance is based on INCOME (£1,600), not profit. Over £1,000 = report it.