Its better than being asked to do it for free.

A company recently asked me to do a task they expected me to take ten hours, unpaid of course. I told them I thought it was kind of ridiculous.

"Well do what you can in two or three hours and if you really impress us with what you have done..."

The company really didn't impress me enough to bother.

Tax authorities usually don't care about a one-off small payment.

where I live you are allowed to gain up to 5k year for 'hobby' projects that you do on the side.

I was pretty happy to find this out recently. It was a non-tech person who brought it to my attention actually. It's definitely motivation to monetize some small projects I've had in mind for a while now.

We can treat that as a consultation gig which may lead to an offer. It is up to the candidate to declare this income to the tax authority.

Plus, what about candidate non-completes, doing a paid task for a competitor? (Most people aren't in California.)