"Thousands of UK homeowners with solar panels could be hit with unexpected £100 fines this week as the HMRC paper tax return deadline approaches. Many are unaware that income earned from selling unused solar energy back to the grid could push them over the £1,000 tax-free trading allowance. With the deadline falling on Friday, homeowners are being urged to check their earnings now to avoid costly penalties."
"With more than 1.6 million UK homes now fitted with solar panels, many are generating extra income through the Smart Export Guarantee (SEG) - payments for selling unused electricity back to the grid. While the average household can make around £300 a year, this amount can easily exceed HMRC's £1,000 trading allowance when combined with other side hustles or freelance income."
More than 1.6 million UK homes have solar panels and many receive Smart Export Guarantee (SEG) payments for selling unused electricity back to the grid. Average households earn about £300 a year from SEG, but that income combined with other side hustles or freelance work can push total trading income past HMRC's £1,000 tax-free allowance. Anyone exceeding the allowance must declare the income on a self-assessment return. Paper self-assessment returns must be received by October 31, while online returns are due January 31, 2026. Missing the paper deadline triggers an immediate £100 fine and further penalties increase the longer returns remain unsubmitted.
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