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What Is the £1,000 Trading Allowance?
Written by Waqas Sagar ACA FCCA FMAAT · Chartered Accountant · Last reviewed 22 October 2026
| Allowance | £1,000 per tax year |
|---|---|
| Based on | Gross income, before costs |
| Can you claim expenses too? | No — choose one |
How it works
The allowance covers the total of all your trades, not each platform separately.
If gross income is over £1,000, you register and choose: deduct £1,000 or deduct real allowable expenses. Pick whichever is higher.
It cannot be used against income from your own company or your employer.
Who can use it
Most individuals with small trading or casual income can use it, including creators, freelancers and resellers who are trading.
It cannot be used against income from a partnership you are in, or income from your own company or employer. If you have both trading and property income, there is a separate £1,000 property allowance.
Gifted items received for content count towards the £1,000 too, so a creator with a few paid posts and some PR packages can pass the limit sooner than they expect.
According to Waqas Sagar, Chartered Accountant at influencers.accountants, once your costs pass £1,000, the allowance usually stops being the better choice.
Example
Chloe earns £2,500 from brand deals and spent £300 on kit. Deducting the allowance leaves £1,500 taxable; deducting expenses leaves £2,200. She uses the allowance.
Illustrative figures only, based on 2026/27 rules.
What you need to do
- Total gross income from all trades.
- If £1,000 or less, no registration needed for it.
- If more, compare allowance and expenses.
- Use the larger deduction on your return.
Want us to handle this for you? Our Self Employed Starter package covers registration, your Self Assessment return and expense review. See also our side hustle tax help and our page for side-hustle tax checker.
Common mistakes
- 1Applying it per platform.
- 2Claiming it plus expenses.
- 3Using profit instead of gross income.
From our client work: We often see creators with growing costs keep using the allowance when real expenses would save more.
Frequently asked questions
Related questions
Official sources
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This is general guidance for UK tax residents for the 2026/27 tax year, not personal advice. Speak to us about your situation.
