Common Self Assessment Mistakes People Make

Reviewed by Neil AinsworthLast updated: June 4, 2026 2:36 pm

Image credit: Anete Lusina @Pexels

In this article:

Overlooking Supplementary Pages
Incorrect or Incomplete Information
Failing to Claim Deductions or Reliefs
Late Submission and Payment
Not Keeping Adequate Records
Using the Wrong Tax Codes
A Financial Adviser Can Help

Completing a self-assessment tax return is a necessary task for many individuals, particularly those who are self-employed, company directors, or receiving other forms of income not taxed at source. Despite the importance of this task, many find the process daunting and are prone to making mistakes that can lead to penalties or overpayment of tax. Understanding these common errors can help ensure that your tax returns are accurate and submitted on time. Here, we explore the most frequent self-assessment pitfalls and how to avoid them.

Overlooking Supplementary Pages

One of the first areas where mistakes occur is the failure to complete the necessary supplementary pages of the tax return. This oversight can occur when individuals are unaware of the need to report additional income, such as property income, overseas earnings, capital gains, or dividends. It is vital to understand that each type of income may require different forms and supporting documentation, which, if overlooked, can lead to discrepancies in reported income and resultant fines.

Property income: If you earn rental income, it is imperative to fill out the property section. This covers UK property and overseas property income, including income from short-term and holiday lets. Note: the Furnished Holiday Lettings (FHL)¹ regime was abolished from 6 April 2025. From that date, income from holiday lets is reported under the standard property income rules (UK or overseas, as appropriate).
Foreign income: Earnings from outside the UK must be declared, potentially on the foreign pages. This includes foreign pensions, employment income, and profits from businesses abroad. Ongoing international information exchange (for example, under the Common Reporting Standard²) increases the importance of accurate reporting.
Capital gains: Sales of assets such as shares or property can give rise to capital gains that must be reported. Remember to declare any gains above the annual exempt amount³, which is £3,000 for the 2026/2027 tax year. Note also that disposals of UK residential property that give rise to taxable gains generally have to be reported, and any tax paid, within 60 days of completion, in addition to your Self Assessment return.

Additional Considerations for Supplementary Pages

Completing these sections accurately helps ensure you do not overpay or underpay your taxes. Here are a few additional points to consider:

When reporting foreign income, use the appropriate exchange rate for the tax year to convert foreign income into pounds sterling. HMRC provides yearly average rates, but specific transaction rates can also be used when they reflect the actual rate at the time of receipt.
For property income, ensure you deduct allowable expenses, such as maintenance, insurance, and letting agent fees, to arrive at the correct taxable profit.
If disposing of an asset such as shares or property, keep records of the purchase and sale amounts, as well as associated costs such as fees and improvements, to accurately calculate capital gains.

Accurate completion of these supplementary pages not only complies with tax laws but also positions you to take advantage of any applicable allowances and reliefs, potentially reducing your overall tax liability.

Incorrect or Incomplete Information

Another typical error is providing inaccurate information. This can range from simple mistakes, such as incorrect National Insurance numbers, to more complex issues, such as misunderstandings about how income from different sources should be reported. These errors can result in an incorrect assessment of your tax liability, potentially leading to penalties or unexpected demands for payment from HMRC.

Common Data Entry Errors

Misreporting income due to decimal point errors, which can significantly alter the amount of tax owed.
Confusing gross income with net income, resulting in incorrect taxable income calculations.
Forgetting to update personal information, such as a change of address, can cause delays or miscommunication with HMRC.
Incorrectly entering data such as dates and financial figures, often due to haste or a misunderstanding of tax forms.

Additional Misunderstandings

Errors often stem from misunderstandings about how different types of income are taxed. For instance, freelance or consultancy earnings are usually reported before deductions (with business expenses then claimed separately), whereas employment income must be reported in its gross form. Other common misunderstandings include:

The treatment of dividends under current rules, with a Dividend Allowance⁴ of £500 for the 2026/2027 tax year. Dividends above this allowance may be taxable at the dividend rates that apply to your band.
How the Personal Savings Allowance⁵ works: up to £1,000 for basic-rate taxpayers, £500 for higher-rate taxpayers, and £0 for additional-rate taxpayers. Interest above your allowance may be taxable and may need to be included on your return (depending on whether HMRC has already collected it via your PAYE tax code). In some cases, the starting rate for savings may also apply.

Strategies to Prevent Errors

To minimise these mistakes, prepare your tax return well before the deadline. This allows ample time to double-check all information, particularly relating to income and personal details. Utilising reputable tax software or working with a qualified accountant or tax adviser can also help ensure accuracy. Such professionals are equipped to handle complex tax situations and can provide guidance tailored to your circumstances.

Failing to Claim Deductions or Reliefs

Many taxpayers miss out on opportunities to reduce their tax bill by failing to claim all the deductions or reliefs to which they are entitled. Commonly overlooked areas include:

Work-related expenses: Costs incurred in your job that your employer has not reimbursed and that you must incur wholly, exclusively and necessarily for your work, for example, certain travel to temporary workplaces, can often be claimed.
Charitable contributions: Donations to charity can attract tax relief, particularly if made through Gift Aid⁶. When you donate through Gift Aid, charities can claim an extra 25p for every £1 you donate, and if you are a higher- or additional-rate taxpayer, you can claim back the difference between your tax rate (40% or 45%) and the basic rate on the donation via Self Assessment.
Private pension contributions: Personal contributions to pension schemes are usually tax-relieved. Basic rate relief is typically added at source, and higher/additional rate relief can be claimed through Self Assessment. The annual allowance for pension contributions that benefit from tax relief is £60,000⁷ for the 2026/2027 tax year (subject to tapering for high incomes and the Money Purchase Annual Allowance⁸ if you have flexibly accessed a pension).

Additional Deductions to Consider

Aside from the commonly missed deductions, there are other areas where tax relief can be claimed:

Professional fees and subscriptions: If you are a member of certain HMRC-approved professional organisations, or you need to subscribe to trade journals for your work, these costs can often be deducted.
Home office expenses: If you are self-employed, you can usually claim a proportion of household expenses such as heating, electricity, and internet based on their business use (or use HMRC’s simplified expenses). Employees can claim only for work performed from home when required by their employer, and costs are not reimbursed.
Capital allowances: If you buy equipment or vehicles for business use, you may be able to claim capital allowances.

Maximising Relief Through Efficient Record-Keeping

Effective management of your tax affairs requires good record-keeping. This not only ensures that all eligible deductions and reliefs are claimed but also facilitates the accurate completion of your tax return. It is advisable to keep receipts and records of all expenses you intend to claim. Digital tools and apps can simplify this process, allowing you to store all necessary documentation in an organised manner and make it readily accessible to HMRC if required. From April 2026, some taxpayers will also be required to keep digital records and submit quarterly updates under Making Tax Digital for Income Tax⁹ (starting with those whose combined self-employment and/or property income exceeds £50,000).

By taking advantage of all applicable deductions and reliefs and maintaining thorough records, you can optimise your tax position and potentially significantly reduce your tax liability. If you need personalised help, consider speaking with a qualified accountant, tax adviser or a regulated financial adviser, as appropriate.

Late Submission and Payment

Procrastination is a significant hindrance to self-assessment. Late submissions can result in penalties, and so can late payments of any tax due. It is crucial to be aware of the deadlines:

Paper returns must be filed by 31 October following the end of the tax year.
Online returns should be completed by 31 January following the end of the tax year.
Tax owed must also be paid by 31 January (including any first payment on account, if applicable).

Setting reminders for these dates or completing the return early can prevent last-minute rushes and mistakes. If you are required to make payments on account, remember a further instalment is usually due on 31 July.

(All figures for penalties have been taken from https://www.gov.uk/self-assessment-tax-returns/penalties¹⁰)

Understanding Penalties for Late Submission

Submitting your tax return or paying your tax bill late can lead to automatic penalties, which can accumulate over time. An initial £100 fixed penalty applies immediately after the filing deadline has passed, regardless of whether tax is due. If the return is more than three months late, additional daily penalties of £10 can accrue, up to a maximum of £900. After six months, a further penalty of 5% of the tax due or £300, whichever is greater, is charged, and the same again after 12 months in many cases. Separate late payment penalties may also apply (typically 5% of the unpaid tax at 30, 6, and 12 months late), and HMRC charges interest on late payments.

Benefits of Early Submission

Completing your tax return well before the deadline has several advantages. Not only does it alleviate the stress of last-minute submissions, but it also provides ample time to review your tax situation comprehensively. This can be crucial for identifying potential savings or recognising any mistakes that might otherwise lead to an enquiry by HMRC. Early submission can also mean that any money owed can be budgeted for more effectively, and if you are due a refund, you may receive it sooner.

Strategic Planning for Payment

If you owe tax, planning how you will manage the payment is essential. HMRC provides the option to set up a budget payment plan, allowing you to make regular weekly or monthly payments in advance. Time to Pay arrangements may also be available if you cannot pay in full by the deadline. If you make payments on account, factor these into your cash flow; you can ask HMRC to reduce them if you expect your current year’s liability to be lower. To set up any arrangement, you must be up to date with your Self Assessment returns.

By taking proactive steps to manage your tax submissions and payments, you can help ensure compliance with HMRC requirements while avoiding unnecessary penalties. Additionally, this approach supports a healthier financial profile, which can be beneficial for future credit assessments or business dealings.

Not Keeping Adequate Records

The importance of keeping thorough and organised financial records cannot be overstated. In the event of an HMRC enquiry, being able to present precise records can swiftly resolve issues. Additionally, good record-keeping helps ensure the tax return is accurately filled out.

Details on What to Keep

It is crucial to understand the specific types of records that need to be maintained. These include, but are not limited to, invoices, bank statements, expense receipts, sales records, and proof of payment. For personal tax purposes, details of your income from all sources need to be meticulously recorded.

Income records: These should include all employment payslips, P60S, and details of any benefits in kind received.
Expense records: Keep all receipts for allowable expenses, such as travel, home office costs, and professional subscriptions.
Capital asset transactions: Record purchase and sale prices, including dates, for assets such as property or shares to accurately report potential capital gains or losses.

How Long Should Records Be Kept?

In the UK, HMRC requires you to keep your records for at least 22 months¹¹ after the end of the tax year for which the tax return is made. However, if you file your return late, you must keep your records for at least 15 months after you filed the return. For businesses, records should be kept for at least five years after the 31 January submission deadline of the relevant tax year.

Benefits of Digital Record Keeping

Digital record-keeping systems can significantly enhance the accuracy and accessibility of your financial records. Utilising accounting software not only helps organise your records but also ensures they are easy to access and analyse. These digital systems can often integrate with HMRC services, simplifying the process of completing and submitting your tax return. From April 2026, Making Tax Digital for Income Tax begins for some taxpayers, so keeping digital records will be essential for those within scope.

Effective record management reduces the risk of errors in tax submissions and can provide substantial evidence in case of financial disputes or audits. By maintaining comprehensive and accurate records, you also stand a better chance of benefiting from all applicable tax reliefs and deductions, ultimately optimising your tax situation.

Implementing a Systematic Approach to Record-Keeping

Setting up a routine for regular record updates can prevent the overwhelming task of organising documents at the year’s end. Allocate time each month or week to update your financial records. This habit not only keeps your financial information up to date but also prepares you well for tax season, reducing the risk of errors from last-minute rushes.

By taking proactive steps to manage and maintain your financial records, you help ensure compliance with tax laws and better prepare for any scrutiny by tax authorities. Remember, good record-keeping is not just a regulatory requirement but a cornerstone of sound financial management.

Using the Wrong Tax Codes

Another common error is failing to update or using incorrect tax codes. This mistake can lead to under- or overpayment of tax. It is advisable to check your tax code each year and after any significant changes to your financial situation, such as a new job, changes to taxable benefits, starting a pension, or adjustments to your personal income.

Understanding Your Tax Code

A tax code typically consists of several numbers and a letter. The numbers indicate how much income you can earn in a year before you need to pay tax, while the letter reflects your situation and how it affects your personal allowance. For instance, the code ‘1257L‘ for the 2026/2027 tax year means you have a standard tax-free personal allowance of £12,570.

Common Issues with Tax Codes

Emergency tax codes: If your tax code is followed by ‘W1’, ‘M1’ or ‘X’, it is an emergency tax code. Such codes are temporary and often result in higher tax payments because they do not account for your full personal allowance.
Multiple employers or pensions: If you have more than one employer or pension, ensure your personal allowance is allocated correctly (usually to a single source) to avoid over- or under-taxation.
Changes in income: Any significant increase or decrease may necessitate a change in tax code. Failing to update your tax code can lead to an inaccurate tax payment.

Checking and Updating Your Tax Code

To avoid discrepancies in tax payments, regularly review your tax code on your payslip or pension payslip and compare it with the code issued by HM Revenue and Customs (HMRC). If you find any inconsistencies, contact HMRC directly to rectify the issue. You can check your current tax code and get guidance on adjustments through HMRC’s online services (your Personal Tax Account) or by consulting your latest P60 or P45 forms.

Consequences of Incorrect Tax Codes

Using the incorrect tax code can not only affect your immediate net income but can also lead to complications such as unexpected tax bills or refunds at the end of the tax year. Regular checks and communication with HMRC can prevent these issues and help maintain accurate tax payments and records.

By staying informed about your tax code and ensuring it reflects your current financial situation, you can avoid potential overpayments or underpayments of tax. This proactive approach aids in better financial planning and compliance with tax regulations.

A Financial Adviser Can Help

These common mistakes in completing the Self Assessment can often be reduced with professional support. A qualified accountant or tax adviser can help you understand which expenses you can claim, how to keep adequate records and how to meet deadlines. Where your wider financial planning is involved (for example, pensions or investments), an FCA-authorised and regulated financial adviser can provide regulated advice tailored to your needs.

At FinancialAdvisers.co.uk, we understand the complexity involved in managing your taxes effectively. Connecting with an FCA-authorised financial adviser in your area can help you navigate Self Assessment and make informed decisions. This content is for information only and does not constitute personal tax advice.

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