Hobbies that make money: How to turn your hobby into a career

Over the last year or so, many of us have had more time to work on our hobbies and side projects. For others, it may have been the time where you’ve found a new pastime or activity you enjoy. But what about turning your hobby into a career? We take a look at how to make money from your hobby.

As well as providing some tips for making a business from your side project, we’ve also looked at how to find a hobby and some things to consider before you pursue it as a career.

What is a hobby?

First things first, let’s look at what we mean by the term hobby. Essentially, a hobby is an activity that you regularly do for enjoyment, relaxation or fun. Usually, a hobby is something that you do in your spare or leisure time. However, as we’ll see, it’s also possible to turn that hobby into something more structured.

This broad definition means that there are many different activities that count as hobbies. Whether it’s a popular creative pastime with lots of fellow enthusiasts and resources or a more niche way of spending your time, most people have hobbies.

How to find a hobby

If you’re looking for new ways of filling your time, there are plenty of options to choose from. As the world slowly starts to return to normal, there will be more options than ever before when it comes to trying something new.

Some considerations when looking for a hobby include: Are you looking for something more creative or active? Are you seeking escapism or tangible gains? Is there something you used to enjoy doing but haven’t had the time to keep up? Do you want your new hobby to be similar to existing ones?

Hobbies that make money

Of course, the thought of having a side hustle that makes some extra cash is an appealing prospect for many. So what are some hobbies that make money? In reality, there’s no straightforward answer – it often depends on your skill, dedication, and the market conditions.

That being said, there are certainly some trends that seem popular at the moment. We’ve picked out a few examples of hobbies that make money below:

    Creative: Hobbies such as writing, design, crafts, music, photography, and other creative pursuits can lead to all kinds of side projects that make money. As a freelancer, you could easily start a blog that shows your creative skills and pitch for project work.

    Tech-based: If you’re interested in coding and programming, games design, web and software development, video editing, or other tech-based skills, you might find it easy to pick up projects that pay for your expertise.

    Food and drink: For those who enjoy baking, cooking, gardening, home brewing, and other culinary pursuits, you might find opportunities to sell your wares either locally or online.

Of course, these are just a few ideas to get your imagination running. In reality, if you have a unique enough idea and the passion to complete work to a high standard, you’ll often find people who are willing to pay for your craft.

That being said, picking up some casual income from a hobby is entirely different from making a business or career from it.

Hobby vs business

It’s important to make the distinction between a hobby and a business. There are several reasons for this. Perhaps first and foremost is that, depending on where in the world you are, if you’re making money from your hobby, you might need to think about the tax implications of this.

In the UK, for example, you have to declare the money you make from a hobby to Her Majesty’s Revenue and Customs (HMRC). However, there are some exceptions to this, mainly that you can earn £1,000 tax-free from your hobbies.

Another consideration is what you’re pursuing your interest for. Do you want to rely on the income you make, or are you purely in it for the enjoyment? A hobby is something that you can pick up and put down according to your schedule, while a business is something that takes time and dedication.

When does a hobby become a business?

For some people, the transition from hobby to business is a gradual and often unconscious one. What starts as entertainment can gradually end up as a side-hustle as time goes by. For others, there is a more definite transition. But from a legal standpoint, when does a hobby become a business?

In the UK, there are some ‘badges of trade’ set out by HMRC that determine whether or not your hobby is a business. Essentially, if you’re making money from it, you’ll need to declare it for tax purposes if that amount is over £1,000. Similarly, if you’re making regular transactions, repairing or modifying people’s assets, or borrowing money to fund transactions, then it’s considered that you’re ‘trading’.

Alternatively, you could go through the process of setting yourself up as a sole trader or limited company before you start selling your products or services. This can mark the start of your hobby becoming a business.  

… to be continued.                    

 —Futurelearn.com