To resent paying so much tax on side hustle earnings?

I just wouldn't declare it unless absolutely unavoidable.

Hopefully you don't expect to benefit from any taxpayer funded services, either.

Well, obviously you will register for VAT as soon as your hobby generates a steady income. Then you won't pay it on your supplies, or will claim it back.

And when it generates a steady income ... you pay income tax.

A business is still a business if you've got another job as well!

Why is this different from being taxed on overtime 🤔

@Powfred

It's like taxing my fun/ leisure time as I enjoy doing it.

So do whatever it is without making a profit? If you're selling something, sell it cheaper so you don't make a profit.

I don't make a profit from my hobbies. If I did, I'd be taxed on them, as you are.

If it helps think of your side hussle as the tax free part of your income then you are o nly paying tax in your main job...

I just wouldn't declare it unless absolutely unavoidable. And then limited company it and claim every expense possible.

The government can keep it's fat greedy fingers out of my pockets thanks.

Do you like having an NHS op?

Put the money into your pension, you'll get tax breaks that way.

This. The fact you developed it from a hobby based activity means you probably enjoy it but that doesn't really matter because it's still an extra job and treated the same.

I have a few creative skills I could possibly monetise but I don't for exactly this reason, it can take the fun out of it.

Good on you for taking it this far though.

Others are right though, it's not PAYE so, if you grow your business, you also need to grow your awareness of tax (with an accountant if it gets that far) to make sure you're not overpaying.

Have you set it up as a limited company? If so you can probably pay out some as dividends tax free before you pay a salary to yourself . You can also claim back expenses. But that's life- anyone with multiple income streams has to fill in a tax return and pay 40% tax on anything even if they also happen to work full time.
I'd suggest cutting down to a .9 contract in your current job

OP always be very careful taking non-professional advice. There can be other tax implications when claiming a proportion of your mortgage interest (not your mortgage principal) as a business expense.

You often hear a lot of 'my mate Dave down the pub says I can claim this or that expense'. Dave down the pub's advice is nearly always wrong.

If you're serious about your business get a good accountant.

As your dp earns less than you, get him/her to do the side hustle! Tax problem solved.

I think side hustles or small time second jobs should have a lower rate of tax. Anyone who takes a second job or does a side hustle probably needs the money

But then we'd all do that. I'd work a small job earning less than £12.7K (and pay no tax), then I get another small job on similar wage. And another, and another... and then a side hustle... But ALL our earnings count - together.

I understand that things are tough but our tax system is what it is. You have already used up your £12,750 tax free allowance in your main job, and your 20% tax allowance too. That does mean that your side hustle is being taxed highly.

You could refarame it, and see your side hustle (earning up to £1,000 per month) as your your tax free portion, but then you pay 20/40% tax on all of your main income. Same net result.

Yeah no reason younshould tax on a job you enjoy doing when some of us are working overtime and either paying tax....or not getting paid, in jobs we hate

Why though?

Why should they pay a lower rate of tax? What's the justification?

Income tax is paid on income, if it goes up it goes up and you pay more tax, whether it's from your side hustle, your main hustle or some other hustle. However, if it looks like your new business could be a good earner then you need to see an accountant as you may be better off trading as a limited company and extracting the profit as dividends. It does depend on your circumstances though.

*Disclaimer: this is an opinion not advice.

You can legitimately write off a hell of a lot of expenses which could even make it look as though you’re running at a loss. There’s loads of videos on YouTube about it, or you could consider hiring an accountant. When we had our business, ours only charged £50 a month. Anyway, you can write off a portion of your rent or mortgage against your tax liability, if you use your car to deliver parcels you can claim
mileage. There’s loads of legitimate things. Don’t worry too much.

It’s highly unlikely you’ve paid taxes all your life unless you were a baby model.

If you have spent much of your working life paying basic rate tax then you are likely to have taken out more than you have put in, especially as you have children. I don’t really understand how you are paying VAT except for the cost of your supplies, in which case you can claim this against profits for income tax. So you will only pay tax on the money you make after taking off your expenses.

The tax system does not differentiate between money you earn for your main job and money you earn from your side hustle. It is all taxable income. If you’re paying higher rate tax you’re already doing well i life. Think about those who will never pay higher rate taxation and are struggling to put food on the table.

You can deduct £1000 instead of actual costs so if you make £2000 you can deduct £1000 and pay tax on the £1000 profit. When you get to a point where your actual costs are more than £1000 you can deduct actual costs instead

You could pay more into a pension pot to avoid the higher tax bracket.

might not help with providing money for days out etc but you’ll reap the benefit eventually.

You earn above a certain threshold (however unfair that might seem) so any income over that is taxable at the higher rate.

What you would suggest otherwise? Everyone in multiple jobs being taxed a lower bands?

It's 40% of the 1850, not the 850. I didn't realise this the first year.