Becoming an expert: the tax basics (UK)

Money earned from advisory calls counts as self-employed trading income as far as HMRC is concerned, even when it's a small amount alongside a salaried job. None of the rules are difficult. The only real danger is ignoring them until the January deadline is on top of you.

The usual caveat applies, sincerely: this is general information rather than tax advice, and an hour with an accountant when you start earning is worth far more than it costs. We would say that, given the business we're in, but it happens to be true.

If you live outside the UK

Everything after this section is about UK tax, for experts who live here. If you live in the EU or Norway, it isn't yours. You pay tax where you live, so your blue lemons earnings go on your own country's return as self-employed income, and the UK doesn't tax them. A few things to raise with your own accountant:

• Your tax year. EU countries and Norway run theirs from January to December, so your dashboard offers a statement for each calendar year rather than each UK tax year.
• Registering as a business. Most countries expect freelancers to register as self-employed, sometimes with a chamber of commerce or for a business number. The rules and thresholds differ by country, and your accountant will know yours.
• VAT. Most of our clients are businesses, and when you advise a business in another country, VAT is usually the client's to account for, not yours. If you are VAT registered, you may also need to account for VAT on our 15% fee in your own return, because it comes from a UK company.
• Currency. Clients pay in pounds and your statements are in pounds. Stripe converts each payout into your own currency, and your Stripe account shows the amount that reached your bank. Your accountant may want both.

We may also have to report what you earn through blue lemons to HMRC, which can share it with the tax authority where you live. Declare it like any other income and there is nothing more to it.

Under £1,000 a year

There is a trading allowance of £1,000. If your total gross self-employed income for the tax year stays at or under that figure, you don't have to register with HMRC or report it. A couple of exploratory calls fit inside the allowance comfortably.

Over £1,000: registering and what you'll pay

Once you pass £1,000, you register for Self Assessment as a sole trader. The deadline is 5 October following the end of the tax year in which you crossed the line (tax years run 6 April to 5 April). Registering is free, takes a few minutes on gov.uk, and gets you a UTR number for filing a return each year.

Tax is then charged on your profit (income minus allowable expenses) in two forms:

• Income tax. Advisory profits sit on top of your other income, so they're taxed at your marginal rate of 20%, 40% or 45%. If you also have a salaried job, PAYE will already have used your personal allowance, so expect the marginal rate to apply to all of the advisory profit.
• National Insurance. Class 4 is currently 6% on profits between £12,570 and £50,270, then 2% above that. Class 2 has become effectively voluntary; above the small-profits threshold your State Pension record is credited without payment.

A workable rule of thumb is to move a third to 40% of every payout into a separate account on arrival. Do that and the January bill is never a shock.

Dates worth putting in your calendar

• 5 October: Self Assessment registration deadline, the year after you first pass £1,000.
• 31 January: online filing deadline and payment date.
• Once your annual bill exceeds £1,000, HMRC also collects payments on account: advance instalments each 31 January and 31 July. The first year this applies feels like paying half as much again, so it's worth knowing about before it happens.

Expenses

Because tax falls on profit rather than income, keep track of the costs of doing the work: a reasonable share of home office costs, equipment, software, professional insurance, accountancy fees, relevant subscriptions. On the blue lemons commission specifically, ask your accountant how they'd like it recorded: either your income is booked net of it, or the gross is booked and the commission claimed as a platform fee. Your dashboard keeps the booking history and your bank records show the payouts, which between them are the records you need.

Making Tax Digital

From April 2026, sole traders with qualifying income above £50,000 have to keep digital records and send HMRC quarterly updates through compatible software. The threshold falls to £30,000 in April 2027 and £20,000 the year after. Side-income levels of advisory work won't be caught for a while. This is a five-minute conversation with your accountant, and inexpensive software covers it.

VAT

Registration becomes compulsory when taxable turnover passes £90,000 in any rolling twelve months. Advisory calls alone won't get near that, though combined with your other income you might. File it under "watch, don't worry".

Sole trader or limited company

Start as a sole trader. It's simple, cheap, and right for advisory income at almost any realistic level. A limited company earns its keep at higher incomes. Both are accountant conversations.

In short

Below £1,000 a year, nothing to do. Above it: register by 5 October, file by 31 January, set aside a third of everything, keep your receipts, and spend one hour with an accountant at the start. That covers it.