New HMRC rules mean around 864,000 taxpayers in the UK face an August deadline for the first time this week. Making Tax Digital is being phased in by HMRC, and a key change means that those who do their own tax returns now have to do quarterly submissions. Those with a turnover over £50,000 in the 2024/25 tax year should be using MTD as of April 6, 2026. This group is affected by this week's new deadline of Friday, August 7, 2026.
Phased Implementation
The rule changes are being phased in year by year. That means those who had a turnover of more than £30,000 in the 2025/26 tax year will need to use MTD from April 6, 2027. Those who were over £20,000 in the 2026/27 tax year will need to use it from April 6, 2028.
Expert Advice
Kevin Mountford, personal finance expert and co-founder of Raisin UK, said: “With just a couple of days remaining until the August 7 Making Tax Digital deadline, the 864,000 sole traders and landlords affected should act now. They need to use HMRC-recognised accounting or bookkeeping software to total the income and expenses held in their digital records, and send that summary directly to HMRC.
Anyone relying on an accountant should check that the update has been submitted on their behalf. Some taxpayers may be putting the task off because they are unsure what information is needed or whether their records are complete, but the simplest first step is to log into their accounting software, check that their income and expenses are up to date and contact their accountant or software provider immediately if anything is unclear.
Penalties and Financial Impact
“Although HMRC will not issue penalties for missing a quarterly update during the first year, delaying it could create a bigger administrative and financial headache later. Taxpayers must still submit the outstanding updates before they can complete their annual tax return, so allowing them to build up risks and turning a manageable quarterly task into a last-minute scramble.
Taking a few minutes now to check what has been recorded and what still needs to be submitted can provide greater clarity and prevent uncertainty from building. That clarity is particularly valuable when confidence around money is already low. Raisin UK’s Closing the Confidence Savings Gap research found that half (50%) of UK adults feel their finances are under pressure and just over half (53%) have less money to spend freely than they did 12 months ago.
Planning for Tax Bills
For sole traders and landlords managing fluctuating incomes, falling behind on tax reporting can add another layer of uncertainty at a time when many already feel they have little financial breathing room. The predicted tax bill generated through the new system should therefore be treated as a prompt to plan, not simply a figure to review.
Setting aside money regularly in a separate easy-access savings account can help taxpayers avoid spending funds that will eventually be owed to HMRC, while allowing that money to earn interest until the bill is due.
Used properly, quarterly reporting could help replace one large January shock with smaller, more manageable financial decisions throughout the year.
