Many of us listen to podcasts every day. But how many of us have thought about making our own podcast? Those of us that haven’t might be missing a trick. New research has found podcasting to be the most profitable side business of the year.
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Side businesses are growing in popularity
Brits are making almost £5,000 extra a year – or £411 each month – from side businesses, according to a survey from 118 118 Money.
Almost 68% of UK adults currently have another source of income on top of their main job. This means the majority of adults are switching off from their 9-5 and switching on to their own side business.
Many seem to have used the commuting time or socialising time they regained during the lockdowns to turn their attention to their income. Others might have started their business while on furlough. Nearly a third (31%) started their side business activity in 2020, while another 18% started side hustling in the first half of 2021.
The most common side business among British adults is selling handmade items. A total of 59% said this is their preferred way of earning extra income.
Other popular activities are investing (20%) and selling antiques or collectibles (12%).
The most profitable side business
Podcasting tops the list of most profitable side businesses by a long way. Podcasters make an average of £954 a month in profits. This would earn podcasters an average of £11,448 each year – a handy sum! That is over double the UK average side hustle income.
Podcasters tend to generate their income through adverts and sponsorship. Some also use a subscription model or membership scheme that offers exclusive content to subscribers.
This is followed by selling handmade candles, which brings in £670 a month on average. Renting out a flat or space took third place. This earns individuals an average of £657 a month.
Those aged 18-24 seem to be making the most of side hustle culture and are earning the most of all generations. Their extra income stands at £546 a month on average. That’s over £100 more a month than the UK average, which is £411.
This gives Generation Z a yearly average of £6,552, over £1,500 more than the average UK annual total of £4,932 a year.
Things to consider with your side business
There are potential legal and tax implications to setting up a side business.
Here’s some things you should consider:
- If you’re running a business from home, you may need to get permission from your landlord, mortgage provider, local planning officer or local Council.
- If you sell goods or services to make a profit regularly, you may need to register as a Sole Trader with HMRC. This tends to be when you earn over £1,000 in a tax year from secondary income. But, you should always check which tax rules apply to your own personal circumstances.
- If you make over £85,000 per year from a secondary source of income, you may need to pay other taxes such as VAT too. This could also require VAT registration.
- If your activity includes handling food, you may also need to carry out a risk-assessment following HACCP procedures and acquire food hygiene training.
Starting a hobby business is usually an enjoyable process. Following the appropriate rules and regulations should help keep it this way and stop your side business becoming an unnecessary headache.
Please note that tax treatment depends on your individual circumstances and may be subject to change in the future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.