Your First MTD Quarterly Update Is Due 7 August 2026

By Robert Marjoram, Together Accounting, June 2026

Your first MTD quarterly update is due 7 August 2026, and if you’re a sole trader or landlord who crossed the £50,000 qualifying income line on your 2024-25 return, this is the deadline that matters. You’re in the system now. The sign-up is done, the software is connected, and the real work starts here.

So let’s get straight to what you actually do. Not what Making Tax Digital is, you already know that. If you need a refresher, our guide to Making Tax Digital for landlords and sole traders covers the sign-up and software setup. What goes in the box, by when, and what trips people up: that’s the post-launch, roll-your-sleeves-up version.

MTD Quarterly Update Deadlines for 2026-27

Your first quarterly update covers 6 April to 5 July 2026, and it must reach HMRC by 7 August 2026. That’s Q1. There are four update periods across the tax year, and they all land on the 7th of the month after the quarter closes.

Notice something about those period dates. Q2 doesn’t start on 6 July. It runs from 6 April again, the full six months. That’s the single most misunderstood part of the whole regime, and it changes everything about how you should think about getting Q1 right. More on that in a moment.

You’re one of around 864,000 sole traders and landlords HMRC pulled into phase one. About 605,000 are self-employed only, 118,000 are landlords only, and 141,000 are both. If you’re in that last group, pay close attention to the multiple-business rule below, because it catches people out every time.

864,000 Total sole traders and landlords in MTD phase 1

605,000 Self-employed only

118,000 Landlords only

141,000 Both self-employed and a landlord (two updates required each quarter)

Source: HMRC Making Tax Digital for Income Tax: business population statistics (based on 2023-24 tax year data)

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What Your MTD Quarterly Update Must Include

Here’s the thing that calms most people down the moment they hear it: a quarterly update under Making Tax Digital for Income Tax isn’t a tax return. It’s not four tax returns. You’re not calculating tax, claiming reliefs, or making any adjustments four times a year.

A quarterly update is a running total of your income and expenses by category, sent to HMRC for each business you run. That’s it. Summary figures, not individual transactions. HMRC doesn’t see every invoice or receipt, only the category totals pulled from your digital records.

And because each update is cumulative from the start of the tax year, you’re really just sending an updated snapshot each time. When you use MTD for Income Tax, Q1 shows the year so far up to 5 July. Q2 shows the year so far up to 5 October, which includes everything in Q1 plus the next three months. Each update overwrites the last.

That cumulative structure is your safety net. If you miss an expense in Q1 or get a figure wrong, you don’t resubmit Q1. You simply correct it in Q2, and the cumulative total puts it right. HMRC’s own guidance says no accounting or tax adjustments are needed at the quarterly stage. Capital allowances, private-use adjustments, the mortgage interest restriction, all of that waits until the Final Declaration.

A quick word on accuracy. HMRC expects your figures to be as accurate as you can make them, and I’d never tell anyone to guess. But you’re not filing a tax computation. You’re reporting income and expense totals from records you should be keeping anyway. If something slips through in Q1, the cumulative structure means it’s fixed by the next update, and there are no penalties for getting it imperfect this year. Aim for accurate, don’t panic about perfect.

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Income and Expense Categories for the Self-Employed and Landlords

The categories in your quarterly update mirror the boxes on the old Self Assessment forms. If you’ve filed an SA103 self-employment page or a property page before, this will feel familiar. Your software does the heavy lifting, but you need to know where things land so your transactions are coded correctly.

For a self-employed business, the income side is straightforward: turnover (your sales, fees, takings) and any other business income. The expense side breaks down into the usual categories:

• cost of goods bought for resale
• payments to CIS subcontractors
• wages and staff costs
• car and travel
• premises running costs
• repairs and maintenance
• admin and office costs
• advertising
• loan interest
• bank charges
• bad debts
• professional fees
• a catch-all for other expenses

For a UK property business, the income is total rents received, plus things like lease premiums or rent-a-room income. The expenses cover:

• premises running costs
• repairs and maintenance
• financial costs (your mortgage interest)
• professional fees (letting agent and legal)
• cost of services
• travel to the property
• other allowable costs

One point HMRC is firm on: report gross income. If a letting agent or platform takes its cut before paying you, the full rent received is your income figure, and the fee goes in as a separate expense.

There’s a shortcut worth knowing. If your annual turnover for a business is under £90,000, you can report consolidated expenses, a single total figure instead of the full breakdown. Plenty of you sitting in the £50,000 to £90,000 band will qualify. My advice? Don’t take the shortcut. Use the full categories from day one. Your Final Declaration needs the detailed breakdown anyway, so consolidating now just creates a pile of work in January 2028. Do it properly once.

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A Few Real Scenarios to Make This Concrete

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The Calendar-Quarter Option, If It Suits You

By default your quarters run 6 April to 5 July, 6 April to 5 October, and so on, those awkward dates ending on the 5th. If your books already run to month-ends, or specifically 1 April to 31 March, calendar quarters are worth a look. HMRC’s guidance recommends them for businesses in that position. You’d report 1 April to 30 June, 1 July to 30 September, and so on. The submission deadlines stay exactly the same: 7 August, 7 November, 7 February, 7 May.

Anyone can elect calendar quarters, but they only make life simpler if your record-keeping naturally runs to calendar months. Two rules you can’t ignore. You make the election in your MTD compatible software, not by writing to HMRC, and you must make it before you submit your first quarterly update. Once Q1 is in, you’re locked into your chosen quarterly periods for the whole tax year. So if you want calendar quarters, decide before 7 August. After that the door is shut until next year.

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No Penalty Points in 2026-27, But the Final Declaration Still Bites

HMRC has put a soft landing on the first year, and I want to quote it precisely so there’s no confusion. The guidance says: “There are no penalties for missing a quarterly update deadline for the 2026 to 2027 tax year.”

That’s genuinely good news. Get a quarterly update in late this year and you won’t pick up a penalty point. From 2027-28 onwards it tightens: one point per missed deadline, and at four accumulated points you get a £200 penalty, then £200 for every miss after that. This year, that machinery is switched off.

But here’s where I have to be blunt, because this is exactly the gap I see glossed over elsewhere. The soft landing is a safety net, not a free pass, and two things aren’t waived.

First, you still have to submit all four quarterly updates to HMRC before you can file your Final Declaration. They aren’t optional, they’re a gateway. Second, the Final Declaration deadline of 31 January 2028 still bites in full. Miss that and the normal penalties and interest apply, exactly as they always have under Self Assessment. The late-payment side bites too, and the figures are easy to get wrong, so here’s the current position straight from HMRC. Pay within 15 days and there’s nothing to pay. For 2026-27, because it’s the first year of these penalties, there’s no penalty even at 16 to 30 days late. From 31 days, you’re looking at 3% of the balance outstanding at day 15 plus 3% of the balance at day 30. Interest runs daily from day one throughout, and from 2027-28 those penalty percentages step up. The full detail sits on HMRC’s penalties guidance.

So treat the quarterly updates as a habit to build now, while the penalties are off. Get into the rhythm this year and the year that actually counts looks after itself.

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Common MTD Quarterly Update Mistakes to Avoid

A handful of errors come up again and again, and every one is avoidable:

• Treating each update as a standalone three months. It isn’t. Every update is cumulative from 6 April. Don’t reset to zero each quarter.
• Forgetting the second business. Self-employment plus property means two separate updates. Two trades means two updates. Software handles it with separate business IDs, but you have to know they’re there. Where you have more than one income source, each one needs its own update.
• Applying the mortgage interest restriction too early. Enter the full interest in financial costs. The 20% credit is a year-end job.
• Reporting rent net of agent or platform commission. If an agent or a booking platform deducts its fee before paying you, HMRC still wants the gross rent reported, with the commission claimed separately as an expense. Check your software isn’t importing the net figure.
• Assuming the old Furnished Holiday Lettings rules still exist. The FHL regime was abolished from 6 April 2025. There’s no separate FHL category. A former holiday let now goes into the standard UK property categories like any other rental.

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What to Do Once You’ve Submitted

Hit submit and your software (or your HMRC online account) shows an in-year tax estimate. Don’t be alarmed by it and don’t act on it. It’s based only on what HMRC has so far, so it ignores your other income, your reliefs, and your year-end adjustments. It isn’t your tax liability. For a seasonal business that’s quiet in spring, Q1 might even show a loss and a £0 estimate. That’s normal. The figures swing as the year fills in.

After that, three things. Keep digital records current as you go (you must keep digital records for five years after the January deadline), and a consistent monthly bookkeeping routine makes quarterly submissions straightforward. Diary the next deadline, 7 November, before you close the laptop. And keep coding transactions to the right categories week by week, because the painful version of MTD is the one where you leave a quarter’s worth of receipts in a drawer and scramble the week before submission. The summer lull is also a good moment to run a mid-year financial review of your trading position.

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We Can Take This Off Your Plate

Around three in four businesses in your position already work with an accountant, and there’s a good reason for that. We handle MTD quarterly updates for our clients start to finish, from setting up the digital records and the right categories to submitting each update on time and pulling it all together for the Final Declaration in 2028.

If the 7 August deadline is looming and you’d rather not spend your evenings second-guessing which box the van insurance goes in, get in touch. This is exactly the kind of thing we sort out for clients every day, and getting the first quarter right sets the tone for the whole year.

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MTD for Income Tax: Frequently Asked Questions

Do I still need to do a tax return?

Not the old Self Assessment tax return. The Final Declaration replaces it, and it’s due 31 January 2028 for the 2026-27 tax year. It pulls in your quarterly figures plus other income, reliefs, and adjustments. If you’d like help with the whole process, our self-assessment service covers both the quarterly updates and the year-end declaration.

What if I have both self-employment and property income?

You submit a separate quarterly update for each. They run on the same deadlines but they’re distinct submissions, because each income source is reported on its own.

What information goes in a quarterly update?

Cumulative totals of income and expenses by category for each business, nothing more. Income and expense figures only, no tax calculations and no adjustments.

When are the quarterly updates due?

7 August 2026, 7 November 2026, 7 February 2027, and 7 May 2027 for the 2026-27 tax year. You send quarterly updates to HMRC through your compatible software.

What if I haven’t joined MTD yet?

If you crossed the £50,000 line and you’re not yet registered, check the qualifying income guidance below. You join MTD through HMRC or your agent, and you’ll need MTD compatible software in place before your first update.