MTD for Income Tax Deadlines and Quarterly Reporting — A Practical Guide
Under Making Tax Digital for income tax, sole traders and landlords replace their annual self assessment return with four quarterly digital updates and a final year-end declaration. Here are the exact dates, what each submission must contain, and what happens when something goes wrong.
The Four Quarterly Deadlines
Quarterly update periods run from the start of the tax year. Submissions are cumulative — each update covers income and expenses from 6 April up to the end of that quarter.
| Quarter | Standard period | Submission deadline |
|---|---|---|
| Q1 | 6 April – 5 July | 7 August |
| Q2 | 6 April – 5 October | 7 November |
| Q3 | 6 April – 5 January | 7 February |
| Q4 | 6 April – 5 April | 7 May |
You can submit early — up to 10 days before the quarter end — if you are confident no further transactions will fall in the period.
Calendar Quarter Option
If you prefer reporting to calendar month ends, you can elect for calendar quarters. The deadlines do not change, but the periods do:
| Quarter | Calendar period |
|---|---|
| Q1 | 1 April – 30 June |
| Q2 | 1 April – 30 September |
| Q3 | 1 April – 31 December |
| Q4 | 1 April – 31 March |
The election must be made before your first quarterly submission for the relevant tax year and applies to all subsequent years until withdrawn.
What Must Each Quarterly Update Contain?
For each business, your quarterly update must include the amount, date, and category of every transaction. For sole traders, expense categories include cost of goods, wages, travel, rent and utilities, repairs, professional fees, advertising, and bank charges.
Adjustments for disallowable expenses — such as private use proportions — are not made quarterly. These are dealt with at year-end finalisation.
Retail businesses can record gross daily takings rather than individual sales. Businesses with turnover below the VAT registration threshold can use simplified three-line accounting showing just totals for income, expenses, and profit.
The Year-End Final Declaration
The final declaration replaces the self assessment tax return. It is due by 31 January after the end of the tax year — the same date as the old return. It includes:
- Accounting adjustments such as closing stock
- Disallowable expense adjustments
- Reliefs and claims
- Confirmation that the information is correct and complete
- Any personal income sources not covered by quarterly updates (such as employment income)
HMRC will not provide an online filing service for the year-end return — it must be submitted through your MTD-compatible software.
Correcting Errors
If you make a mistake in a quarterly update, correct it in the next submission. Because figures are cumulative, the corrected total will flow into the following quarter automatically. If the error is in the final quarter, correct it through the year-end finalisation process.
Frequently Asked Questions
Q: What happens if I miss a quarterly deadline? A: You receive a penalty point. Once you accumulate four penalty points (one per missed quarterly deadline), a £200 financial penalty applies. Further missed deadlines after the threshold is crossed each attract a £200 penalty. Points are reset after 12 months of full compliance. Note that for 2026/27 only, there is a soft landing — no penalty points are applied for missed quarterly submissions in that first year.
Q: Do I need to submit a quarterly update if I had no transactions in that quarter? A: Yes — a nil return is still required if you are within MTD. You must submit for every quarter regardless of activity.
Q: Can I change from standard quarters to calendar quarters mid-year? A: No. The calendar quarter election must be made before your first submission for a tax year. You cannot switch part way through a year.
Need help with MTD reporting? Contact Liberate Accountants for a free consultation, or learn more about our self assessment service.
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