Up to 300,000 taxpayers will no longer need to file a self assessment tax return as the Treasury raises the annual reporting threshold from £1,000 to £3,000. However, this change won’t take effect until at least the 2027/28 tax year, as HMRC needs time to develop an alternative online reporting system.
The increase aims to reduce confusion around tax liabilities for those earning extra income from selling clothes online, dog-walking, taxi driving, or content creation. While these individuals may no longer need to file a tax return, tax will still be due on earnings above the £1,000 tax-free allowance.
At an ICAEW/CIOT conference, Treasury Minister James Murray confirmed that affected taxpayers can report their earnings and pay any tax due online. The Treasury stated the change would be implemented before the end of this parliament.
In addition, HMRC is introducing a dedicated service for accountants and tax agents to resolve outstanding PAYE and self assessment queries. This service, designed to improve response times, will allow agents to escalate cases unresolved for over four weeks. A specialised team will handle cases from start to finish, ensuring regular communication.
These changes are expected to reduce the administrative burden on taxpayers and agents, though calls remain for further simplification to ease the self assessment process.
Talk to us about your finances.
