DNA double-strand breaks are a major threat to cellular survival and genetic integrity. In addition to high fidelity repair, three intrinsically mutagenic DNA break repair routes have been described, i.e. single-strand annealing (SSA), polymerase theta-mediated end-joining (TMEJ) and residual ill-defined microhomology-mediated end-joining (MMEJ) activity. Here, we identify C. elegans Helicase Q (HELQ-1) as being essential for MMEJ as well as for SSA. We also find HELQ-1 to be crucial for the synthesis-dependent strand annealing (SDSA) mode of homologous recombination (HR). Loss of HELQ-1 leads to increased genome instability: patchwork insertions arise at deletion junctions due to abortive rounds of polymerase theta activity, and tandem duplications spontaneously accumulate in genomes of helq-1 mutant animals as a result of TMEJ of abrogated HR intermediates. Our work thus implicates HELQ activity for all DSB repair modes guided by complementary base pairs and provides mechanistic insight into mutational signatures common in HR-defective cancers.