As with all forms of income, you will need to pay taxes on any money you make from your part-time self-employed job. If the main reason for your side job is to turn a profit, and the work is regular and continuous, then you qualify as self-employed for tax purposes. If you are self-employed, you can pay your taxes by filing a self-assessment tax return.
You will also need to make additional contributions to National Insurance on top of those made through your regular job. For any profits made on self-employed profits totaling more than £6,205, you will need to pay Class 2 National Insurance. This money is paid directly to HMRC, and you can register to make these payments online. For earnings above this, you will need to register for Class 4 National insurance. If your profits fall between £8,424 and £46,350 you will need to pay 9%, and profits of more than £46,350 will be charged at 2%.
Like full-time self-employed workers, those with a side job can use allowable deductions to reduce their tax bill. If you can prove that an expense is being used solely for your business, then you can deduct the cost from your tax bill. Deductions frequently expensed by part-time self-employed workers include:
- Space in your home used exclusively for business
- Car-related expenses that are exclusively related to business (mileage, gas charges for rideshare drivers)
- Tools or equipment required for the job
More information on what expenses can be deducted by a self-employed worker filing taxes can be found on the gov.uk website.