The Tax Traps New Self-Employed People Don’t Expect

Starting as self-employed in the UK comes with a few tax surprises that are easy to miss. For example, a business expense is not automatically allowable just because you paid for it while working. The rules can be more specific, particularly for costs such as working from home, travel, meals and equipment. Another common trap is failing to keep records from day one — trying to reconstruct months of expenses later can mean missing legitimate deductions or being unable to support a claim.

There is also a less obvious risk: HMRC deadlines are not the only dates that matter. You may have obligations to register, keep records and respond to HMRC before you ever submit your first tax return. Even a simple message from HMRC should not be ignored, as it may require action by a specific date.

The best time to avoid these problems is before they happen. Understanding what counts as a genuine business expense, keeping evidence for your calculations and staying on top of HMRC correspondence can prevent small oversights from becoming expensive ones.