Trading allowance 2025-26: the £1,000 rule for gig workers

What it is

The trading allowance is a tax-free allowance of up to £1,000 of gross trading income per person per tax year. It is legislated through the Income Tax (Trading and Other Income) Act 2005. It stays at £1,000 for 6 April 2025 to 5 April 2026. It is per person, not per platform, and it covers all casual, trading and miscellaneous self-employed income combined.

How it applies to gig workers

If your total gross trading income from all gig work for 2025-26 is £1,000 or less, you can usually claim full relief. You do not need to tell HMRC about that income and you do not need to file a Self Assessment return for it, as long as you have no other reason to file. You still keep records because HMRC, DWP or your council can ask.

If your gross trading income is more than £1,000, you must register for Self Assessment and file. You then pick one of two methods each year for that trade. Option A is partial relief using the trading allowance: ignore your real expenses and knock a flat £1,000 off your gross income. Option B is actual expenses: claim fuel, insurance, repairs, phone, platform fees and so on. You cannot do both for the same income.

Worked example. A rider earns £999 from Uber Eats and £100 from Deliveroo in 2025-26. Total is £1,099, so she must register. Actual expenses are £600. Under Option A, profit is £99. Under Option B, profit is £499. Option A wins.

Second example. An Uber and Amazon Flex driver earns £12,000 gross with £4,100 of real vehicle expenses. Option A leaves profit at £11,000. Option B leaves profit at £7,900. Option B wins by £3,100 of taxable profit, which saves roughly £620 in income tax plus Class 4 NI. The trading allowance is a planning tool, not a hack. With DAC7-style platform reporting live, HMRC can see every app total. Using the allowance does not hide income.

What you should do about it

• Add up all gross gig income across Uber, Deliveroo, Amazon Flex, Just Eat, Stuart, Gophr and any side work for 6 April 2025 to 5 April 2026.
• If £1,000 or less and you have no other reason to file, claim full relief and keep basic records.
• If over £1,000, register for Self Assessment by 5 October 2026.
• Work out your realistic annual expenses. If they are over £1,000, claim actual expenses instead of the allowance.
• Never stack the trading allowance on top of claimed expenses for the same income. That is over-claiming.

Last reviewed

19 April 2026

Internal links this page emits (3-5):

• trading allowance check — anchor: "run the trading allowance calculator"
• self assessment deadlines 2026 — anchor: "Self Assessment deadlines"
• mileage 45p 25p rate — anchor: "45p mileage rate"
• dac7 — anchor: "DAC7 platform reporting"
• expenses gig workers — anchor: "gig worker expenses guide"

Primary source used:

• Research/S1-getting-started/1.3-trading-allowance.md