The government have re announced the £1,000 tax allowance that starts from 6 April 2017. This was first announced in spring 2016 (see our blog 17 March 2016). The Autumn statement tweaks the allowance to include income generated from sharing goods and services along with trading income.
The effect of the new allowance is that from 6 April 2017:
If you earn up to £1000 from trading (now including any sharing) this is exempt from tax and does not need to be declared.
if you earn up to £1000 from letting this is also exempt from tax and does not need to be declared.
If you earn more than £1000 from either trading or letting, then you can either deduct from your income your business expenses as normal, or deduct £1000.
The £1000 allowance does not apply to letting income from which rent a room relief has already been applied.
The allowance does not apply to partnership income.
Remember this does not apply to your 2016 tax return (tax year 2015-16) or your 2017 tax return (tax year 2016-17). For those tax returns any letting or trading income should be declared, no matter how small.
As with all of our tax tips and web pages this information is necessarily summarised and of a general nature. If you would like detailed specific advice please contact us.