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Filing your Self-Assessment – Avoid These Common Pitfalls

Posted: 25th February 2025

The January self-assessment deadline has come and gone, and more than a million people missed the deadline. Self-employed individuals, landlords, and those with complex tax affairs must submit their tax return by midnight on 31 January, but according to HMRC, an estimated 1.1 million people did not file. This process can bring a lot of stress to taxpayers, who often worry about the potential penalties associated with late or inaccurate submissions. So how do you make sure you don’t become one of those million for 2026 when filing your self-assessment?

To support you with this, we’re going to outline four common self-assessment pitfalls, including furnished holiday lets, national insurance changes, self-employed expenses, and rental property income. We’ll also share some of our actionable advice that helps our clients meet their obligations confidently and accurately.

1: Furnished Holiday Lets

Furnished holiday lets (FHLs) are types of short-term accommodation that allow property owners to earn an income. However, these differ from other rental properties, as tax reliefs are available for FHLs.

Furnished holiday lets need to meet specific criteria to qualify for beneficial tax treatment. They must:

Be in the UK or the European Economic Area (EEA)
Let out on a short-term commercial basis
Have sufficient furnishings for normal occupation

There are also key conditions for FHLs, such as availability, letting, and occupancy rules.

Common errors for furnished holiday lets include misclassification of properties and incorrect claims for allowable expenses, like maintenance or capital allowances. To ensure you’re compliant, we’d recommend keeping detailed records of your FHLs, and consulting a tax advisor for clarity on FHL eligibility. This helps you avoid costly errors.

Overview of furnished holiday lets and their tax benefits

2: Changes in National Insurance Contributions

HMRC has made recent changes to national insurance (NI) thresholds and rates, which affect self-employed individuals in particular. Class 2 NI will no longer be due for most self-employed individuals, and Class 4 National Insurance will be reduced from 9% to 6%.

As some taxpayers may not be fully up to speed with these changes, mistakes such as underpayment or overpayment can be common. Staying informed and proactive is essential to avoiding miscalculations, so be sure to check HMRC’s NI updates thoroughly, and use accurate tax software to stay compliant.

3: Self-Employed and Claiming Expenses

If you’re self-employed, you’ll be able to claim expenses. But there are ways and means to go about this correctly.

Common allowable expenses include office supplies, travel, and business-related utilities. However, some taxpayers can overclaim personal expenses, or fail to claim legitimate business expenses. This is why it’s important to maintain clear records and receipts to substantiate expense claims.

If you’re finding it hard to keep track of your records and receipts, you can use software like Quickbooks and Xero to help you. You can also seek professional advice to accurately track and claim expenses.

Remember that poor record-keeping can often lead to tax disputes and penalties, so make sure you don’t overlook this process.

4: Rental Properties and Declaring Income

Those who rent out property will have to pay tax on any profit they make, including from residential and commercial properties. This information must be declared accurately to avoid penalties.

While HMRC clearly lays out its expectations, many taxpayers can find it difficult to work out their rental income. Frequent errors include failing to report all income, misreporting expenses, or misunderstanding rules for joint ownership. This means there is a high potential for penalties for non-disclosure or inaccurate reporting.

To stay compliant and reduce your risk, we recommend keeping detailed rental income and expense records and gaining a thorough understanding of allowable deductions. You can also use digital tools and online calculators to simplify reporting.

Filing your return with confidence

When submitting your self-assessment, pay close attention to furnished holiday lets, national insurance changes, self-employed expenses, and rental income declarations. These are the key areas taxpayers can struggle with, so be sure to prepare essential documents early and check your details are accurate. This will help you meet the January deadline with less stress and hassle.

To get expert advice and support with your self-assessment, speak to our team. With years of knowledge under our belts, we can give you reassurance, guidance and peace of mind with your upcoming tax returns.