In our experience, some of the most expensive words in business and personal finance are surprisingly simple:
“I didn’t realise.”
We hear them in many different situations.
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“I didn’t realise rental income needed declaring.”
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“I didn’t realise I had to register for Self Assessment.”
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“I didn’t realise that counted as taxable income.”
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“I didn’t realise HMRC would look at that.”
Very rarely do these situations begin with bad intentions. Most start with assumptions, outdated information, or misunderstandings about how the rules apply.
Unfortunately, HMRC doesn’t assess penalties based purely on intention. They assess whether reasonable care was taken.
And that’s where problems can begin.
Assumptions Are Expensive
Tax rules change. Reporting requirements evolve. Thresholds move. Digital systems increase transparency.
What may have been “fine” ten years ago may no longer be correct today.
Common areas where people say “I didn’t realise” include:
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Rental income not declared in full
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Small side income assumed to be “too minor to matter”
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Capital gains on property or shares
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CIS misunderstandings
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Not registering for Self Assessment when required
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Assuming HMRC “won’t notice”
Often, it’s not the tax itself that causes the biggest shock - it’s the interest and penalties that follow.
Why This Year Matters
As we approach 5 April, it’s a sensible moment to pause and ask:
Is there anything I’ve assumed rather than confirmed?
From April 2026, Making Tax Digital for Income Tax begins for those it applies to. While this won’t increase the tax someone pays, it does increase the frequency and visibility of reporting.
More regular reporting means fewer gaps to hide behind - intentionally or otherwise.
That makes clarity more important than ever.
Prevention Is Always Cheaper Than Correction
In many cases, issues can be resolved quickly and calmly if addressed early.
But once HMRC opens an enquiry or contacts you first, your position changes. Penalties can increase. Timelines tighten. Control reduces.
The difference between:
can be significant - financially and emotionally.
A Practical Approach
At Donaldson Ross & Co, we believe most tax problems are preventable.
We encourage clients to:
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Ask early
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Clarify uncertainties
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Keep records up to date
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Avoid assumptions
Tax doesn’t need to be dramatic. But it does require attention.
If you’re unsure whether something needs declaring, or whether you’ve interpreted the rules correctly, a short conversation now can often prevent much bigger conversations later.
Because in tax, the words “I didn’t realise” are rarely cheap.