Millions of Brits could keep more earnings from side hustles as new job salary rules announced
Brits making a second income are set to be better off after Andy Burnham made two announcements that could impact millions.
The Prime Minister said people with side hustles, including through the likes of clothes selling on apps like Vinted, will be able to pocket more of their cash with the new reforms.
Currently people with a second income can generally earn £1,000 a year tax-free under HMRC's Trading Allowance.
People generally only pay tax on any amount above that allowance, although personal tax circumstances matter. Those with gross trading income exceeding that amount may need to register for Self Assessment.
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However earlier this week, Andy Burnham made an announcement for 'those with side hustles', revealing that from April next year, people will be able to earn triple that amount before paying any tax.
Brits could keep more from side hustle earnings
The new threshold will be £3,000 which will mean it is tax free and won't need to be reported to HMRC until people earn more than that amount.
People are able to make thousands on the likes of Vinted, as LADbible previously reported how one woman revealed she was set to earn a mammoth £100k on the side hustle after first starting out on the re-selling app.
Making the announcement in a statement, Burnham said: "If you’ve got a side hustle, this is for you. Maybe you’re a keen Vinted seller, maybe you do some dog walking or petsitting in your spare time, maybe you’re a teacher doing some extra tutoring.
"Up to now, if you earned more than £1,000 a year from it, you had to start paying tax on it. But I think if you're putting in the extra hours, more of that money should stay with you.
"So, we've tripled the amount you can earn from a side hustle without paying a single penny of tax on it.
"From April next year, you’ll be able to earn up to £3,000 tax free and without having to report it to HMRC. That could mean an average £380 off their tax bill.
"It’s a small measure, but one that makes it easier to earn a bit extra or give that business idea a go. Your side hustle should be exactly that - yours."
Major job changes announced
It was quite the week for job announcements, as Mr Burnham also revealed a major reform to advertisements for jobseekers.
A new law is set to come in that will force businesses to clearly display salaries online for applicants.
The government is now planning to make the pay details compulsory with legislation on the issue being brought forward 'as soon as possible'. The changes are set to help jobseekers and also prevent pay discrimination.
According to the Office for National Statistics (ONS), the gender pay gap for full-time employees stands at 6.8 percent. Across all employees, including part-time workers, the gap rises to 12.3 percent between men and women.
The Cabinet Office launched a consultation into pay and reducing discrimination earlier this year, with 94 percent of respondents backing the move.
Announcing the move, Burnham explained: "Looking for a job can be daunting enough, especially when it's your first one, without having to guess what you're actually going to be paid.
"And when pay is kept hidden, women in particular lose out. So, we're changing the rules.
"Soon, employers will have to include salary information when they advertise a job. Because if you're asking someone to give up their time to apply, the least you can do is tell them what the role pays.
"And putting pay out in the open helps close the gender pay gap too. It's a small change, but it makes work a bit fairer for everyone."
However, industry groups said regulating adverts was not always suitable and that setting pay was more complex.
Neil Carberry, chief executive of the CIPD, argued that while publishing salary guidance was 'a good thing', setting pay was more challenging in practice, adding: “There isn’t always a single fixed figure, and employers will want to set pay based on a candidate’s skills, experience and potential.
"A salary range gives employers that flexibility while giving candidates a clear expectation of pay,” he said. “It’s complex though, which is why job advert drafting is best left to good employer practice rather than government regulation.”
James Holt
