The Most Common Self-Assessment Mistakes HMRC Sees Every Year

The most common self-assessment mistakes HMRC sees every year are missing the 31 January deadline, omitting income, over-claiming expenses, using the wrong figures on the self-employment pages, and forgetting payments on account, and each one can trigger penalties, interest, or an enquiry. This self-assessment tax return guide for UK 2026 walks a sole trader through where returns usually go wrong and how to file a clean, accurate return. Blue Tick Accountants, a Guildford-based UK tax advisory and accountancy practice, prepares self-assessment returns for self-employed people across the UK and sees the same avoidable errors year after year. This guide explains the key pages of the return, the income and expenses HMRC expects to see, and the practical steps that keep you out of trouble, including the new Making Tax Digital rules now in force.

Key Takeaways

• The online self-assessment deadline is 31 January following the end of the tax year, so the 2025/26 return is due by 31 January 2027.
• The late filing penalty is a fixed £100 even if no tax is owed, rising once the return is more than three months late.
• From 6 April 2026, sole traders and landlords with qualifying income above £50,000 must keep digital records and submit quarterly updates under Making Tax Digital for Income Tax.
• Payments on account are advance instalments of tax, each equal to 50% of the previous year's bill, due by 31 January and 31 July.
• You can only deduct expenses incurred wholly and exclusively for the business, so personal or mixed costs must be apportioned or excluded.
• Keeping records for at least five years after the 31 January filing deadline is a legal requirement for the self-employed.

What Are the Most Common Self-Assessment Mistakes?

The most common self-assessment mistakes are missing the filing deadline, leaving out a source of income, claiming expenses that are not allowable, and entering figures in the wrong boxes on the self-employment pages. Each of these is easy to make and each can cost money, which is why a careful self-employed tax return matters more than speed.

Missing income is the error HMRC pursues most aggressively, because the tax authority now receives data from banks, platforms, and payment processors and cross-checks it against returns. A sole trader who declares trading profit but forgets bank interest, dividends, or income from an online marketplace risks a discrepancy that prompts a complete self-assessment HMRC review. Entering turnover net of fees, double-counting an expense, or transposing digits are also frequent, and they distort the tax due in both directions. The fix is methodical: reconcile every income source to your bank statements before you start, and check each figure twice.

Understated profit also understates Class 4 contributions, so a correction rarely stops at income tax, as our guide to Class 2 and Class 4 National Insurance sets out.

How Do You Avoid Missing the Self-Assessment Deadline?

You avoid missing the self-assessment deadline by registering early, filing online by 31 January following the tax year, and never leaving registration or filing to the final week. The online deadline for the 2025/26 self-employed tax return is 31 January 2027, and the paper deadline is the earlier 31 October 2026.

New sole traders must register for self-assessment by 5 October following the end of the tax year in which they started trading, and HMRC then issues a Unique Taxpayer Reference, which can take up to ten working days to arrive. Leaving registration late is a classic cause of a missed first deadline.

Worked example. A sole trader files their 2025/26 return on 15 February 2027, two weeks late, owing £4,000 in tax. They receive an automatic £100 late filing penalty regardless of the tax owed, and interest accrues daily on the unpaid £4,000 from 1 February 2027. Filing even a day late therefore costs at least £100, so the deadline is worth protecting.

Which Expenses Do People Get Wrong on a Self-Employed Tax Return?

People most often get expenses wrong by claiming costs that are not wholly and exclusively for the business, by failing to apportion mixed-use costs, and by claiming capital items as everyday expenses. Only expenses incurred wholly and exclusively for the trade are allowable against profit on a self-employed tax return.

Common problem areas include the use of home as an office, motoring costs, clothing, and entertaining. Working from home allows either a flat-rate monthly amount based on hours worked or a fair proportion of actual household bills, but not both. Motoring can be claimed using HMRC's simplified mileage rate of 55p per mile for the first 10,000 business miles and 25p thereafter, or as a business proportion of actual running costs, again not both. Client entertaining is never allowable, and ordinary clothing is not deductible even if you only wear it for work.

Worked example. A sole trader with £50,000 turnover claims £3,000 of motoring as 100% business when one third of the mileage is personal. HMRC disallows £1,000, increasing taxable profit by £1,000 and the tax due by £260, being £200 of income tax at 20% and £60 of Class 4 National Insurance at 6%, plus possible penalties for a careless error. For a full overview of the return process, see our guide to self-assessment tax returns.

How Does Making Tax Digital Change the Self-Employed Tax Return?

Making Tax Digital for Income Tax changes the self-employed tax return by requiring digital record-keeping and quarterly updates to HMRC, replacing the single annual return for those above the income threshold. From 6 April 2026, sole traders and landlords with qualifying income above £50,000 must keep digital records and submit quarterly updates using compatible software, followed by a final declaration by 31 January.

Qualifying income means gross trading and property income before expenses, not profit, so a sole trader turning over £55,000 with £40,000 of profit is still within scope. Those with qualifying income above £30,000 join from April 2027, and those above £20,000 from April 2028. If your income is below £20,000 you remain on the existing annual self-assessment system for now, filing one return by 31 January as before.

The most common new mistake is assuming the annual deadline is the only thing that matters. Under Making Tax Digital, four quarterly updates plus a final declaration are required each year, and missing a quarterly update carries its own points-based penalty regime from 2027/28, after the soft landing on the first twelve months ends. A complete self-assessment HMRC process under these rules depends on having compliant software in place before the tax year begins.

What Happens If You Make a Mistake on Your Tax Return?

If you make a mistake on your tax return you can correct it, but the consequences depend on whether HMRC views the error as careless, deliberate, or an innocent mistake. You can amend an online return yourself within 12 months of the 31 January filing deadline, so a 2025/26 return can be corrected until 31 January 2028.

Where additional tax is due, HMRC charges interest from the original due date and may add a penalty based on the behaviour behind the error. Penalties range from 0% for a genuine mistake where reasonable care was taken, up to 30% for carelessness and far higher for deliberate understatement. Telling HMRC about an error before they find it, an unprompted disclosure, usually reduces any penalty significantly. Keeping records for at least five years after the filing deadline is what lets you prove your figures if questioned.

Frequently Asked Questions

What is the penalty for filing a self-assessment return late?

The penalty for filing a self-assessment return late is an automatic £100 fixed fine, charged even if you owe no tax or are due a refund. If the return is more than three months late, HMRC adds daily penalties of £10 per day up to £900, with further charges at six and twelve months, plus interest on any unpaid tax.

When is the self-assessment deadline for the 2025/26 tax year?

The online self-assessment deadline for the 2025/26 tax year is 31 January 2027, and the paper return deadline is 31 October 2026. Any tax owed for 2025/26 must also be paid by 31 January 2027, alongside the first payment on account for 2026/27 where one is due.

Do I need to register for self-assessment if I am newly self-employed?

Yes, if you are newly self-employed you must register for self-assessment by 5 October following the end of the tax year in which you started trading. HMRC then issues a Unique Taxpayer Reference, which can take up to ten working days, so registering early avoids missing your first filing deadline.

What are payments on account?

Payments on account are advance instalments towards your next year's tax bill, each equal to 50% of the previous year's liability. They are due by 31 January and 31 July. Forgetting them is a common cash-flow shock, because the January payment can include the balancing payment for one year and the first instalment for the next.

Does Making Tax Digital apply to me?

Making Tax Digital for Income Tax applies to you if you are a sole trader or landlord with qualifying gross income above £50,000 from 6 April 2026, above £30,000 from April 2027, or above £20,000 from April 2028. If you are below £20,000 you continue filing a single annual self-assessment return for now.

How Blue Tick Can Help

Blue Tick Accountants prepares accurate self-assessment returns for sole traders, freelancers, and landlords, reconciling every income source, claiming only allowable expenses, and making sure payments on account and Making Tax Digital obligations are handled correctly. Working with an adviser removes the guesswork, protects you from avoidable penalties, and frees your time to run your business. Head to our website and book a meeting now.

Conclusion

Most self-assessment penalties come from a handful of avoidable errors: filing late, omitting income, over-claiming expenses, and overlooking payments on account. Register early, reconcile every income source, claim only what is wholly and exclusively for the business, and make sure you are ready for Making Tax Digital if your income is above £50,000. The single most valuable action is to start early, because an accurate return filed in good time is far cheaper than a rushed one corrected later.

About the Author

This guide was written by Leon, founder of Blue Tick Accountants, a Guildford-based UK tax advisory and accountancy practice that helps self-employed people, landlords, and limited company owners across the UK. It was last reviewed for the 2026/27 tax year.

This article is intended for general informational purposes only and does not constitute tax, legal, or financial advice. Tax rules are subject to change and their application will depend on your individual circumstances. You should always seek advice from a qualified professional before taking action. Blue Tick Accountants accepts no liability for decisions made on the basis of this content.

Related reading: What Happens If You Miss the Self-Assessment Deadline?.

Related reading: Self-Assessment Tax Refunds: How to Claim Money Back from HMRC.