So HMRC has announced that they'll no longer
require thousands of pensioners with side hustles
to file a tax return as part of new proposals
revealed this week. So by the end of 2029, the
tax office plans to increase trading income reports
and thresholds up from 1 ,000 pounds to 3 ,000
pounds. Now pensioners are increasingly likely
to have some kind of a side hustle and that might
be making some arts and crafts to sell at the
local market or maybe buying and selling some
collectibles on eBay or Vinted or even running
a paid YouTube channel, guilty. Now under current
regulations anyone earning below a thousand pounds
from a side hustle within any tax year is actually
exempt from paying any tax or even need to declare
the income and this is due to a thousand pound
trading allowance. So no need to declare, no
need to pay any tax on it. But that's only about
20 pound a week and typically pensioners with
this kind of side hustle are more likely to make
around 50 pound per week. Now that's 2 ,600 pound
per year and then you would be required to fill
in a tax return and that can be quite onerous.
So with the new rules, individuals won't need
to report income until it goes over £3 ,000,
though they'll still need to pay the taxes they
owe above £1 ,000. But rather than filling in
on one of them horrible tax returns in January,
with these lower incomes, they'll be able to
log on through what they describe as a straightforward
tax bill or possibly pay via their tax code online.
James Murray. is the exchequer secretary to the
treasury. And he said that the change is there
to facilitate entrepreneurial activities. But
his actual quote was, so from trading old games
to creating content on social media, we're transforming
HMRC to help Britain maximise their entrepreneurial
ventures. This adjustment means fewer texture
submissions and more of a focus on growing side
hustles. Now, HMLC estimate up to 300 ,000 individuals
including those selling on items on platforms
like vintage or eBay will no longer need to file
a self -assessment tax return. Approximately
one third of these won't owe any taxes at all
because they're below the thousand and the other
two thirds can pay their tax using this new simple
online service I referred to. Now I think that
More could be done to lessen the admin burden
on taxpayers. And while there is some relief
for those with a side hustle, they'll still be
responsible for declaring and paying these taxes.
Now they could, I think, have gone a bit further
and actually exempted more taxpayers from self
-assessments. And if they just raised the limit
from 1 ,000 pounds to 3 ,000 pounds, they could
have created many more grey entrepreneurs. Now,
HMRC has actively been targeting individuals
who sell goods online. and they've been sending
reminder letters out to those they suspect of
underreporting this type of income. And this
follows new regulations implemented this January
that mandated platforms to automatically report
user information related to set these kind of
sales to HMRC. And this allows the tax office
to identify earners who were having this kind
of income. Now, many pensioners are actually
unaware that the likes of eBay and Vint are sending
their information directly to the taxman. HMRC
actually plans to introduce a program aimed at
encouraging informants to report tax evaders,
and they're offering some substantial awards,
which did try to align, I think, more with what
they're doing in America with the IRS. And experts
have actually been saying that... What they've
learned from looking at what the IRS do shows
that you can really get significant tax recoveries
if you use an informant -based rewards. They're
actually quite critical of what the HMRC have
been doing. in terms of inadequate procedures
for whistleblowers. And they highlight the importance
of giving some pretty serious incentives to encourage
reporting of that more serious tax fraud because
actually can be quite dangerous for the informants,
particularly where the tax evasions around organized
crime. So for me, it's good news that we can
now earn up to three grand outside hustle. up
to three grand on the side also without having
to do a tax return, but it could have been better.
They could have just raised the threshold from
1 ,000 to 3 ,000. But anyway, we've got some
big news coming tomorrow from Tracy and I, so
don't forget to tune in. It will be quite big
news for us anyway. So I'll see you on the next
one. Thanks for listening.