DC (20) is a student. Last tax year (2023 - 24) he earned around £1500 as a freelance sports coach, and a similar amount as an employee in a different casual job (which was visible to HMRC via PAYE records). HMRC rules say that if you earn more than £1k freelance in a single tax year you're meant to register as a sole trader and fill in a tax return. He hasn't done this yet and thinks it's not important as his total earnings are well below the basic rate tax threshold. I half-agree, but as he is likely to work in finance when he graduates, I also think he needs to keep his nose clean.
For context: The freelance job wasn't cash in hand - the sports club he works for keeps proper records and he has to invoice them for the hours worked.
My questions are:
- Is it reasonable for him to not register as a sole trader, on the grounds that if he did register there would be nothing to pay?
- Is the sports club likely to routinely report the names of its many freelancers to HMRC?