Side hustles, that is extra money-makers on top of a full-time job, have become popular in recent years. 

The idea of turning a hobby into a small business took off during the pandemic, when many found themselves with extra time on their hands. 

But while plenty of people are making good money from their side hustles, new figures show it is not the easy money-maker that so many believe it to be.

In fact, more than a third side hustles are bringing in less than £100 per month, according to research from money transfer service Remitly Business.

While some three per cent of side hustlers said they were making more than £2,000 per month, as many as 36 per cent said they earn less than £100.

A further 32 per cent said they earn between £100 and £499, meaning that the vast majority find they earn less than £500 from their extra business. 

The average side hustle pays just £367.88 per month.

Men, the survey found, are more likely to earn more than £500 per month, with 17 per cent doing so.

While enough to pay some bills or your weekly shop, the amount of time that many side hustles require people to commit may make these difficult to justify in the long term.

Those that do earn a tidy sum are at risk of owing the taxman as a result. Current rules mean that those earning over £1,000 per year are required to declare the income to HM Revenue & Customs.

While you may need to file a tax return, you are only likely to owe money if your side hustle amounts to trading activity that makes you a profit above your available tax allowances.

The threshold is set to rise to £3,000 by the end of 2029.

Ryan Riley of Remitly told This is Money: 'People can, unfortunately, get a skewed idea of what success looks like when it comes to side hustles because of what is shown on social media. 

'Within seconds, you can find videos of people claiming to earn hundreds of thousands from many different jobs. As our data shows, the reality can be quite different.

'With more people entering the side hustle space, it’s often harder to stand out than it was even a few years ago, especially for those with less experience.'

Five per cent said they have yet to earn anything from their side hustle, despite having already committed time to trying to make it work.

The benefit to these side hustles is that many require no upfront cash to get started. Some 49 per cent said they didn’t pay anything to begin the business.

However, the amount of time and energy spent on these side businesses could have a negative impact on some people, creating stress and a poor work-life balance.

Even so, Riley added: 'While many side hustles won’t become major income streams, that doesn’t mean they lack value. 

'Smaller but consistent earnings, even those bringing in less than £100 a month, can still make a meaningful difference to cover unexpected expenses or provide a bit of financial breathing room.'

The key to side hustle success 

When starting a new side hustle, it is best to avoid throwing in all of your chips at once.

Remitly Business suggests testing the concept of your side hustle first with only a small investment. If you see positive results, then you might be able to scale this up.

Riley said: 'Research is critical before investing your time, money, or energy into a side hustle. Understanding the current market landscape, the level of competition, and the realistic potential for returns can help avoid disappointment.' 

Even when doing so, be sure to track your spending and earnings, as well as your time commitment to the side hustle. This will help to ensure that you don’t waste time on something that doesn’t generate the return it should.

'The key is to go in with clear expectations: not every side hustle will pay the rent, but even modest ventures can add stability in uncertain times,' Riley added. 

Budgeting and tracking will also help when it comes to making sure you aren’t cheating the taxman, as well as ensuring you aren’t paying over the odds.

If possible, separate your side hustle’s earnings and expenses from your own. You can set up a business account, and pay yourself a regular salary from this.