The Most Common Mistakes People Make on Their Tax Return (and How to Avoid Them)

Even small errors on a tax return can result in penalties, unexpected tax bills, or missed refunds. The good news? With a little preparation, most mistakes are easy to avoid. Here are the top pitfalls to watch out for:

1. Forgetting to Declare All Income

It’s not just your main job that counts. HMRC expects you to report:

• Dividends from shares

• Bank interest

• Rental income

• Crypto transactions

• Side hustles or freelance work

👉 Tip: Keep an income log throughout the year so nothing slips through the cracks.

2. Claiming Expenses You’re Not Entitled To

A common mistake is trying to claim personal or non-business costs. HMRC only allows expenses that are “wholly and exclusively” for business.

Avoid claiming for:

• Everyday clothes

• Personal phone bills

• Home improvements (repairs may be allowed, but upgrades are not)

👉 Tip: Always check HMRC’s guidance before claiming.

3. Missing the Deadlines

Late filing is one of the most expensive mistakes. Key dates to remember:

• Register for Self Assessment: by 5 October

• File paper return: by 31 October

• File online return: by 31 January

👉 Tip: Don’t wait until January — file early to avoid stress.

4. Entering Incorrect Figures

Even small typos can create big problems. Wrong numbers may trigger HMRC queries or penalties.

👉 Tip: Cross-check all entries with your P60, P45, bank statements, and invoices. Consider using accounting software to reduce errors.

5. Not Keeping Proper Records

If HMRC asks for evidence, you’ll need to provide it. By law, records must be kept for at least 6 years.

👉 Tip: Store receipts, invoices, and bank statements digitally as well as physically, so you always have a backup.

Conclusion

Most tax return mistakes come down to rushing, poor record-keeping, or lack of awareness. Taking time to stay organised — and seeking professional help if needed — can save you stress, fines, and money in the long run.