How to Protect Your Side Hustle from Tax Trouble in South Africa
- Bryden Nair
- May 30
- 3 min read
In 2025, more South Africans than ever are earning extra income on the side. Whether you’re selling products online, consulting part-time, offering freelance services, or monetizing a hobby — your side hustle can become a valuable income stream. But with that extra income comes an often-overlooked reality: tax compliance.
At Horizon Trading Solutions, we’ve seen many individuals fall into avoidable tax traps that cost them unnecessary money, penalties, and stress. Here’s how you can stay on the right side of SARS while growing your side hustle confidently.
💼 Is Your Side Hustle Taxable? (Short Answer: Yes)
The South African Revenue Service (SARS) considers any income earned — even part-time or casual income — as taxable. This includes:
Freelance work (writing, consulting, design, coaching, etc.)
Selling goods (online stores, craft markets, baking, etc.)
Services rendered (cleaning, tutoring, repairs, photography, etc.)
Gig economy work (Uber, Bolt, Airbnb, etc.)
Content creation (YouTube, OnlyFans, Substack, etc.)
👉 If you're receiving money, you may have a legal obligation to declare it — even if you have a full-time job or if your side hustle is still small.
🔍 Common Tax Mistakes Side Hustlers Make
1️⃣ Not Registering for Provisional Tax
If you're earning non-salary income above R30,000 per year, you may need to register for provisional tax and submit twice-yearly estimates.
2️⃣ Not Keeping Proper Records
Without proper records of income and expenses, you're at risk of either under-declaring income or missing out on legitimate deductions.
3️⃣ Mixing Personal and Business Finances
Many side hustlers use their personal bank account for both private and business transactions, creating a messy paper trail.
4️⃣ Failing to Charge VAT (When Required)
If your turnover exceeds R1 million in a 12-month period, VAT registration becomes mandatory.
5️⃣ Ignoring SARS Auto-Assessments
Many people assume SARS auto-assessments are "final." If your side hustle income isn't included, you're responsible for correcting it.
🧾 What Expenses Can You Deduct?
The good news? SARS allows you to deduct legitimate expenses related to earning your side income. This may include:
Office/studio rent
Internet and phone expenses
Marketing and advertising
Supplies and raw materials
Professional subscriptions
Equipment depreciation
Travel expenses (if applicable)
✅ Proper documentation is key — keep invoices, receipts, and statements.
📊 How SARS Is Watching
SARS is increasing its data-matching capabilities and receives information from:
Banks
Payment platforms (PayPal, PayFast, Yoco, SnapScan)
Airbnb, Uber, and other gig platforms
International revenue-sharing programs (YouTube, Amazon, etc.)
💡 In short: undeclared income is increasingly visible.
💡 The 5-Step Tax Plan for Side Hustlers
At Horizon Trading Solutions, we advise side hustlers to follow this simple framework:
1️⃣ Register your side hustle properly (sole proprietor, company, or trust depending on scale).
2️⃣ Open a separate bank account for business income and expenses.
3️⃣ Track every cent of income and expense.
4️⃣ Work with a qualified tax professional to prepare your tax submissions accurately.
5️⃣ Review your structure annually as your business grows.
🚩 When to Seek Professional Help
If your annual side hustle income exceeds R30,000
If you receive income from foreign platforms
If you're unsure whether you should register for VAT
If SARS has flagged your return or issued penalties
If you're thinking of formalizing your business structure
✅ Horizon Trading Solutions: Your Side Hustle Tax Partner
Whether you're earning a few thousand rands a month or building a scalable business, tax compliance doesn’t have to be scary.
✅ We help you stay compliant
✅ We maximize your allowable deductions
✅ We protect you from unexpected penalties
✅ We give you peace of mind
👉 Book a consultation today and let’s safeguard your side hustle.
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