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The rise of financial influencers on platforms like TikTok has made tax advice more accessible—but not necessarily more accurate. While social media can be a helpful tool, it’s also become a breeding ground for harmful tax myths that could land you in serious trouble with HMRC.
Chris Demetriou, co-founder of Archimedia Accounts and a trusted voice in business advisory, highlights seven of the most misleading pieces of tax advice circulating online—and explains the truth behind them.
Just Say It’s for Work—You Can Claim Anything
You can’t claim everyday purchases as business expenses just because you say they’re “work-related.”
To be deductible, an expense must be:
- Wholly, exclusively, and necessarily incurred for business
- Backed by clear, accurate records
Think twice before trying to claim:
- Coffee
- Personal tech
- Clothing
- Cars (without business justification)
“Claiming personal costs as work expenses is a red flag. HMRC can impose serious fines—and even pursue legal action,” warns Demetriou.
Influencers Can Deduct Lifestyle Expenses
Posting about a product or experience online doesn’t make it a business expense.
Unless you’re incurring a cost solely for business use—such as a professional photoshoot or a sponsored trip—most lifestyle-related spending is personal and not tax-deductible.
Even clothes featured in your videos aren’t claimable if you also wear them in your everyday life.
You Can Deduct Gambling Losses
Gambling losses are not deductible unless you’re a registered, full-time professional gambler—something very few people can prove.
For casual or hobby gamblers, losses are personal and can’t be offset against taxable income.
Side Hustles and Freelance Work Don’t Need to Be Declared
All income—no matter how small—must be declared.
Whether you’re tutoring, freelancing, or selling online, you need to keep track of every penny earned. Even if your income falls under the £1,000 trading allowance, it still needs to be reported.
“Failing to report income can lead to fines of up to £5,000—or even prison time,” warns Demetriou.
Cash Payments Are Tax-Free
Getting paid in cash does not exempt you from paying tax.
Cash is a form of payment, not a loophole. Income tax still applies, and if you’re an employee, your employer must deduct PAYE and NIC even when paying you in cash.
HMRC is increasingly scrutinising cash-based businesses and transactions—so be sure to keep detailed records and report all income honestly.
Forming a Limited Company Lets You Deduct Personal Costs
Setting up a limited company doesn’t give you the licence to claim personal expenses as business costs.
Unless you’re running a genuine business with real operations and income, using a company to write off personal spending is fraud—and will attract HMRC scrutiny.
“If you’re struggling to manage business expenses, invest in accounting tools or software to stay compliant,” advises Demetriou.
If Someone Else Does My Tax Return, I’m Not Responsible for Mistakes
You are legally accountable for your tax return—even if a friend or family member prepared it.
Always:
- Use a qualified tax professional
- Review your return carefully
- Ensure you understand what’s being claimed on your behalf
Mistakes—even innocent ones—can lead to penalties. But if you identify an error and correct it quickly, HMRC may waive the penalty, especially if it’s a first offence.
Stay Informed, Stay Compliant
TikTok can be a fun place to pick up financial tips—but don’t mistake viral content for qualified advice. Falling for tax myths can cost you dearly in the form of fines, audits, or even legal action.
Key Reminders:
- Only claim legitimate, clearly documented business expenses
- Report all income, even if paid in cash or earned casually
- Use certified tax advisors and trusted software for compliance
- Understand that you are responsible for your tax return—no matter who files it
When in doubt, always check guidance directly from gov.uk or speak to a professional accountant.