What is the distinction between "earning untaxed income" and "acting as a sole trader" (UK HMRC)

Question

I live in the UK and have a full-time job paid in the usual way under PAYE. In addition, I have received small amounts of income from various organisations (honoraria in return for activities undertaken on behalf of professional societies) that amount to slightly more than HMRC's £1k threshold.

Looking at the HMRC website, there seems to be a distinction being drawn between "declare additional untaxed income" and "declare income earned as a sole trader". Is there any practical difference between these two options, and are both applicable to my circumstances? If so, what determines my choice?

Answer 1

The site you link to says (emphasis mine):

You must send a tax return if...you were self-employed as a 'sole trader' and earned more than £1,000

You may also need to send a tax return if you have any untaxed income [list of examples]

So just from the info on that page, self-employed income of <£1K doesn't automatically mean you have to send a tax return. I think they call out the sole trader case specifically because of the £1K threshold there.

In your case it's clear you'll have to send a tax return as you have received more than the £1K threshhold. At that point nothing else really matters, the tax return will make it clear where to put the sole trader income.

If you had been under the £1K threshhold, then I think the way to make sense of the page you link to is to follow the "Check if you need to send a tax return" link. That has a multi-stage questionnaire that should clarify the position for various different scenarios.