British Prime Minister, Andy Burnham has announced plans to triple the tax-free earnings allowance for people running side businesses, allowing individuals to earn up to £3,000 annually without paying tax or reporting the income to HM Revenue and Customs (HMRC).
In a social media statement, Burnham said the proposed change would increase the current £1,000 trading allowance to £3,000 from April next year, providing additional financial relief for people generating income through small businesses and other side activities.
He highlighted examples of people who earn extra income through platforms such as Vinted, dog walking, pet sitting and private tutoring, arguing that individuals who put in additional hours to supplement their income should be allowed to keep more of what they earn.
According to Burnham, the increase could benefit approximately 400,000 people, with an estimated average tax saving of £380 per person.
He described the measure as a modest but important intervention that could encourage more people to explore entrepreneurial opportunities, develop business ideas and generate additional income without facing immediate tax obligations.
“Your side hustle should be exactly that – yours,” he said.
The proposed increase is expected to provide greater flexibility for individuals operating small-scale businesses and those seeking additional sources of income amid continuing cost-of-living pressures.
