HMRC has issued a reminder to millions of taxpayers across the UK. If you earn money outside your main job or win through savings accounts, you may need to declare additional income. Failing to do so could result in penalties or a tax investigation.
Let’s break down exactly what needs to be reported and how to stay on the right side of the rules.
What Does It Mean?
The term “declare additional income” refers to telling HMRC about money made from side activities. This includes freelance work, online selling, part-time jobs, or gig economy work.
If you earn more than £1,000 in a tax year from any of these, you must report it. This rule applies even if you already pay tax through your main job.
Keeping accurate records is key. It helps you avoid mistakes when completing your Self Assessment return.
When to Declare Additional Income from Premium Bonds
Premium bond winnings are tax-free. But any interest earned through these or similar savings vehicles is not. If the total interest you earn in a year goes beyond your Personal Savings Allowance, you must declare additional income to HMRC.
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Basic-rate taxpayers: allowance is £1,000
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Higher-rate taxpayers: allowance is £500
Go over this limit? You’ll need to report the extra interest in your Self Assessment.
Tools to Help You Declare Additional Income Correctly
Not sure if you need to report? Use HMRC’s online checker to see if you must file a tax return. This tool is helpful for people who do casual work or earn side money.
If you’re confused, it’s wise to speak to a tax adviser. They can guide you on how and when to income without stress.
Why It’s Important to Declare Additional Income on Time
HMRC tracks untaxed income using digital tools and data matching. Waiting too long or ignoring small earnings can trigger penalties.
To stay compliant:
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Keep records of all income
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Track interest from bonds or savings
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Use Self Assessment when needed
Final Thoughts
Earning extra money is great—but you must handle the tax side correctly. Whether it’s freelance work or interest from bonds, knowing when to additional income keeps you safe from fines.
Take the time to understand your tax obligations and use the tools HMRC offers. That way, you can enjoy your earnings without worry.
