Aussies looking to make some extra money in 2025 might be in for an unwelcome tax bill, an expert has warned.
Side hustles are rising in popularity as ns continue to battle a cost of living crisis.
But H&R Block ‘s director of tax communications, Mark Chapman has reminded Aussies that any income they receive, even from a secondary job, is taxable and must be declared on your tax return.
‘You might think your side hustle is just a hobby but the ATO will disagree,’ Mr Chapman wrote in a column for Yahoo Finance.
‘Particularly if you’re coming out of a paid job, you’re probably used to getting your taxes deducted straight from your pay packet by your employer.
‘But now you’re in business on your own account, you need to proactively manage your cash flow to set money aside for future tax bills.
‘This might seem obvious but unfortunately failing to set money aside to pay tax is one of the most common pitfalls that new businesses fall into.’
Mr Chapman’s top tip for keeping taxes stress-free was to get an accountant.
‘Most people find it far less stressful to simply pass on all their information to a tax agent and leave it to the agent to complete their BAS and tax return, safe in the knowledge that the work done will be accurate and complete,’ he said.
‘An experienced agent will usually be good at sniffing out those obscure tax deductions you didn’t know you could claim so they can often pay for themselves several times over.’
Mr Chapman added that if you start a side hustle, you can claim deductions on any expenses incurred as part of running the business including internet bills, landline or mobile phone bills and the cost of office furniture.
The expert said Aussies could only claim the business-related element when expenses relate to a mix of business and private use.
In March, 6.7 per cent of the labour force or 974,000 people worked multiple jobs, n Bureau of Statistics data showed.
Some of them are turning to gigs on jobs marketplace Airtasker to bring in extra money.
Baker and single mother Brittany Davidson told Daily Mail she was able to make $4,000 a month finding rental properties for rich investors, mystery shopping for big corporations and even writing funeral eulogies.