The trading allowance makes the first £1,000 of gross trading or casual income each tax year tax-free with no need to register or file. Sell on Vinted, do occasional freelance jobs or tutor on weekends: if total gross receipts stay at or under £1,000, HMRC does not need to hear about it.
Above £1,000 you must register for Self Assessment, and you then choose: deduct the £1,000 allowance from income instead of expenses (best when costs are low), or claim actual expenses (best when costs exceed £1,000). You cannot do both. The Side Hustle Tax Calculator shows which option wins for you.
£800 of Etsy sales in a year needs no registration and no return. £3,000 of sales with £400 of costs is different: you register, and you choose the £1,000 allowance over the £400 of actual expenses, leaving £2,000 taxable instead of £2,600. The allowance is per person per year, not per side hustle, so three small gigs share one £1,000.
