Making Tax Digital for Income Tax (MTD for IT) is no longer a date on the horizon. It went live on 6 April 2026, and if you're one of the sole traders or landlords now inside the regime, your first quarterly update is due by 7 August 2026. That deadline is coming up fast, and missing it is the kind of avoidable stress we'd rather help you skip entirely.
Here's a plain-English rundown of what's changed, who it affects right now, and the practical steps to stay on the right side of HMRC.
Who has to comply from April 2026?
You're in the first wave of MTD for Income Tax if your qualifying income was more than £50,000 in the 2024–25 tax year. Qualifying income means your combined gross income from self-employment and property — before expenses — not your profit. So a sole trader turning over £55,000 with £20,000 of costs is still caught, even though taxable profit is well under £50,000.
If that's you, HMRC will have written to confirm your obligation. Two more waves follow: from April 2027 the threshold drops to £30,000, and from April 2028 it falls again to £20,000. In other words, even if you're not affected yet, most self-employed people and landlords will be within a couple of years — so it's worth understanding now.
What actually changes
Under the old system, you kept records however you liked and filed one Self Assessment return a year. MTD replaces that with three obligations:
- Keep digital records. Your income and expenses must be recorded in MTD-compatible software, not a shoebox of receipts or a paper ledger.
- Send quarterly updates. Four times a year, you send HMRC a summary of your business income and expenses through that software.
- Submit a Final Declaration. After the tax year ends, you confirm your figures, add anything else (savings, dividends, reliefs) and finalise your tax position — this replaces the annual Self Assessment return.
The quarterly updates are cumulative summaries, not four mini tax returns, and you don't pay tax four times a year. Your payment dates don't change. But the rhythm of your bookkeeping does: it now needs to be kept up to date throughout the year rather than pulled together in a January panic.
The deadlines you need in your diary
For the 2026–27 tax year, the standard quarterly update deadlines are:
- Quarter 1 (6 April – 5 July): due 7 August 2026
- Quarter 2 (6 July – 5 October): due 7 November 2026
- Quarter 3 (6 October – 5 January): due 7 February 2027
- Quarter 4 (6 January – 5 April): due 7 May 2027
Your Final Declaration for 2026–27 is then due by 31 January 2028, the same date your Self Assessment balancing payment falls.
The one to focus on right now is 7 August. If your digital records for April, May and June aren't yet in compatible software, that's the immediate job.
The mistakes we're seeing already
In the first few months of MTD, a handful of avoidable problems keep cropping up. People assume a spreadsheet is enough — it can be, but only with bridging software that connects it to HMRC, and many spreadsheets aren't set up that way. Others leave signing up to the last minute and discover the authorisation process takes longer than expected. And a common one: treating the quarterly update as final and precise. It doesn't have to be perfect — you tidy everything up at the Final Declaration — but the records behind it do need to be complete and digital.
There are also genuine exemptions, for example if you're digitally excluded, but these have to be applied for and approved by HMRC. You can't simply opt out because the new system feels like a hassle.
How to get ready without the headache
If you already use cloud bookkeeping with bank feeds and receipt capture, you're most of the way there — the software does the heavy lifting and the quarterly submission becomes a few clicks. If you're still on spreadsheets or paper, now is the moment to move across, ideally before the August deadline forces the issue.
This is exactly the sort of change we handle for clients every day. Our bookkeeping and accounting service for sole traders includes free, MTD-ready software, real-time bank feeds and a dedicated UK-qualified accountant who keeps your quarterly updates on track — so the deadlines above become our job, not yours. If you run a property business alongside a limited company, our support for limited companies and partnerships covers the same ground, and freelancers juggling multiple income streams are well within scope too.
MTD for Income Tax is a real shift, but it isn't one you have to navigate alone — and handled properly, it can actually make your finances clearer and your January far calmer. If you'd like to know exactly where you stand before 7 August, get an instant quote or book a quick call and we'll walk you through your next steps.
This article is general guidance, not personal tax advice. Your circumstances may differ, so please get in touch for advice tailored to you.