More than 864,000 sole traders and landlords within the scope of Making Tax Digital for Income Tax have just two weeks left before the deadline to submit their first quarterly update. The update covers income and expenses for the first three months of the tax year, and the deadline for submitting it to HM Revenue and Customs is August 7, 2026.
What the quarterly update involves
The first quarterly update is not a tax return but a short summary sent directly to HMRC through recognised software. It takes just a few minutes to complete and could see sole traders and landlords save on their tax returns.
Craig Ogilvie, HMRC’s director of Making Tax Digital, said: "This is a landmark moment for the tax system. Hundreds of thousands of sole traders and landlords are now keeping digital records and will be sending their first quarterly update in the coming weeks."
Who must comply
Making Tax Digital for Income Tax became mandatory from April 2026 for sole traders and landlords with qualifying income over £50,000. Those within its scope must ensure they are signed up in time to submit their forms. Customers who have not yet signed up can still do so now by visiting GOV.UK, where they can also find software and access free guidance and webinars. If customers use an agent, they can sign them up instead.
Some software includes a digital support tool, HMRC Assist, which gives tailored feedback to help customers spot potential errors before submission. Customers remain responsible for ensuring their return is accurate. After each update, users can see an estimate of their tax bill, helping them to plan ahead.
Future extension and tax return reminder
The MTD will extend to those earning more than £30,000 from April 2027, and to those earning more than £20,000 from April 2028. The tax return deadline remains 31 January. Quarterly updates do not replace the tax return. Customers will still need to submit their return and pay any tax owed by January 31, 2027.
Natasha Patterson, a potter who opened her first store in 2023, told Headline Money that the process for filing the update is seamless and easy. She said: "I went back to check I did it right about three times, but it really was very straightforward. Everything made sense and was logical - it wasn’t overwhelming, even though it was all new to me. If they can all go this seamlessly, we will be set up for smooth sailing at the end of this tax year."
