HMRC warns of hefty fines for missing tax returns on side earnings over £1,000

The tax authority has warned those who don't could face a penalty of £100

HMRC has issued a stark warning about a widespread misunderstanding that could see you slapped with a hefty fine. In an update shared this morning, the tax authority stressed the necessity of filing tax returns by October 5 if certain conditions apply.

Busting a common myth, HMRC's post clarified: "Myth: HMRC hasn't been in touch, so I don't need to file a tax return," and countered with the reality check: "Reality: You might need to do a tax return if you: Have earned more than £1,000 through a side-hustle. Are newly self-employed. Rent out a property. Use cryptoassets."

While PAYE usually takes care of tax deductions for salaries and pensions, those with additional income streams must take action themselves. According to Which?: "If you receive any other income - such as from self-employment, property, capital gains, or dividends - you need to report this to HMRC by sending a self-assessment tax return."

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The tweet from HMRC also included a checklist for taxpayers: "Reality: You might need to do a tax return if you: Have earned more than £1,000 through a side-hustle. Are newly self-employed. Rent out a property. Use cryptoassets. Check if you need to register by October 5, reports the Express.

Last year, it was estimated that over 12.1 million people were expected to file a 'Self Assessment' tax form, according to consumer champion Martin Lewis. This can be done by filling out a form online or sending a paper copy - but for the latter, you'll need to request 'form SA100' by calling HMRC.

In addition to the four reasons outlined in HMRC's X post, its site also highlights various other circumstances where you might need to fill in a tax return. These are outlined below:.

To see if this applies to you, the public is advised to use HMRC's simple online checker tool, which is available in both English and Welsh. Although the tool requires some financial details to work, it won't send your information to HMRC.

If you miss the deadline or fail to send a tax return at all within three months of October 5, you may face a penalty of £100. Beyond this, the fine will only increase and interest will be added.