First MTD for Income Tax Quarterly Returns Due Soon – Are You Ready?

The first quarterly submissions under Making Tax Digital (MTD) for Income Tax are due in just a few weeks, and many sole traders and landlords are still unsure what they need to do.

If your business or property income exceeds £50,000 per year, you may already be required to comply with MTD for Income Tax from April 2026. This means keeping digital records and submitting quarterly updates to HMRC using compatible software.

What Is Making Tax Digital for Income Tax?

Making Tax Digital (MTD) is HMRC's initiative to modernise the tax system by requiring digital record keeping and more frequent reporting.

Instead of simply submitting one Self Assessment tax return each year, affected taxpayers must:

• Keep digital records of income and expenses

• Use MTD-compatible software

• Submit quarterly updates to HMRC

• Complete an End of Period Statement (EOPS)

• Submit a Final Declaration at the end of the tax year

The aim is to provide HMRC with more regular information throughout the year and reduce errors in tax reporting.

Who Is Affected?

You are currently required to comply with MTD for Income Tax if your total gross income from self-employment and/or property exceeds £50,000 per year.

The scheme will expand further:

• From April 2027 – taxpayers with qualifying income over £30,000

• From April 2028 – taxpayers with qualifying income over £20,000

If you're unsure whether you fall within the rules, it's worth checking now rather than waiting until a filing deadline approaches.

When Is the First Quarterly Submission Due?

For taxpayers who joined MTD from 6 April 2026, the first quarterly update covering the period from 6 April to 5 July 2026 is due by 7 August 2026.

While quarterly updates are generally simpler than a full tax return, they still require accurate records and timely bookkeeping.

What Information Needs to Be Submitted?

Quarterly updates include summary figures for:

• Business income

• Business expenses

• Property income

• Property expenses

The quarterly submissions are not intended to calculate your final tax bill. Instead, they provide HMRC with an ongoing picture of your income throughout the year.

What Happens If You Miss the Deadline?

HMRC operates a points-based penalty system for late submissions.

Each missed filing deadline may result in a penalty point being added to your record. Once you reach the penalty threshold, financial penalties can apply.

Late payment penalties and interest may also be charged where applicable.

Common Problems We Are Seeing

Many taxpayers are finding that:

• Their bookkeeping is not fully up to date

• They are still using spreadsheets that do not meet MTD requirements

• They are unsure which software to use

• They have not yet registered for MTD

• They do not know whether their rental income counts towards the threshold

Leaving these issues until just before the deadline can create unnecessary stress and increase the risk of penalties.

How We Can Help

At Beyond Bookkeeping, we help sole traders, landlords and small business owners stay compliant with Making Tax Digital.

Whether you need help choosing software, maintaining digital records, completing quarterly submissions or managing your ongoing bookkeeping, we can provide a solution tailored to your needs.

If you're unsure whether MTD for Income Tax applies to you, get in touch and we'll be happy to help.

Don't Leave It Until the Last Minute

With the first quarterly MTD submissions due shortly, now is the ideal time to ensure your records are accurate and your software is ready.

Taking action now can help you avoid penalties, reduce stress, and keep your tax affairs running smoothly throughout the year. Schedule a consultation with us today!