Making Tax Digital: don't panic — here's what's actually true
Making Tax Digital (MTD) for Income Tax gets talked about like a cliff edge. It isn't. Here's who it applies to, what it asks you to send, the real dates, and the real cost of getting something wrong. Every figure is cited to its source, so you can check it yourself.
Who's in
People are brought in (“mandated”) in phases. What counts is your qualifying income — self-employment plus UK property income, before expenses — measured in an earlier tax year:
| Qualifying income measured in | Threshold | Mandated from |
|---|---|---|
| 2024-25 | over £50,000 | 6 April 2026 |
| 2025-26 | over £30,000 | 6 April 2027 |
| 2026-27 | over £20,000 | 6 April 2028 |
This schedule is set in law: SI 2026/336 reg 27.
The gotcha: Whether you're in is worked out on your GROSS turnover — self-employment income plus UK property income, added together before you deduct a single expense. A sole trader with a big turnover and small profit is judged on the turnover figure, not the profit.
What you actually send
Each quarterly update is cumulative — it covers everything from the start of the tax year to the end of that update period, not just the last three months. Category totals only; no transaction-level detail crosses to HMRC, and no accounting adjustments are made at this stage.
That cumulative design has a practical upside: miss one, the next one heals it. A late or wrong update is corrected by resending the year-to-date figures in the next update — there is no separate amendment process to learn.
Cumulative reporting was introduced by the Income Tax (Digital Requirements) (Amendment) Regulations 2024: SI 2024/167.
The deadlines
Four quarterly updates a year. The standard quarters (starting on the 6th of the month) are shown below; choosing calendar quarters instead shifts the period edges, but not the deadlines.
| Quarter | Period covered | Deadline |
|---|---|---|
| Q1 | 6 April 2026 – 5 July 2026 | 7 August 2026 |
| Q2 | 6 April 2026 – 5 October 2026 | 7 November 2026 |
| Q3 | 6 April 2026 – 5 January 2027 | 7 February 2027 |
| Q4 | 6 April 2026 – 5 April 2027 | 7 May 2027 |
The 31 January return deadline for the full year sits after all four — unchanged by any of this.
The penalty truth
HMRC fines lateness with points, a bit like a driving licence — collect enough points and a fine follows. Here is the official position for this first year:
No penalty points for late quarterly updates in 2026-27: HMRC says there are no penalties for missing a 2026-27 quarterly-update deadline. Every update must still be sent before the tax return can be submitted. Late payment penalties still apply under their own timing rules, and the tax-return deadline is separate.
Read both halves of that: the let-off covers points for LATE quarterly updates only. It changes nothing about paying what you owe on time.
Angry about MTD? Here's who decided — and how to say so.
What it costs elsewhere vs here
Commercial MTD software is usually a paid monthly subscription. TaxSorted is free, and the code that produces every figure on this site is open — AGPL-3.0 licensed, published on GitHub. If you don't trust a number, go read the function that made it.
Read the code on GitHub (opens in a new tab)What to do this month
- 1.Check if I'm in — enter your gross self-employment and UK property income and see whether, and from when, the rules apply to you.
- 2.Start your records — a local-first ledger sorted into HMRC's own MTD categories, ready whenever you are.
- 3.Note the date: the first quarterly update deadline of the 2026-27 tax year falls on 7 August 2026, if you're mandated in.
Signing up itself stays manual, directly with HMRC — no software can enrol you. Sign up for Making Tax Digital for Income Tax on GOV.UK.