Compliance
Compliance Alerts: Making Tax Digital Quarterly Updates and Deadlines
The UK’s first quarterly update deadline under Making Tax Digital for Income Tax is approaching. Landlords and sole traders need to be ready to avoid penalties in future years.
By NomadicTax Research Team • 5-8 min read • August 9, 2026
## What is Making Tax Digital (MTD) for Income Tax?
Introduced for sole traders and landlords with qualifying income above **£50,000**, MTD for Income Tax requires:
- maintaining **digital records** using HMRC-recognised software,
- submitting **quarterly updates** on income & expenses,
- continuing to file a full Self Assessment tax return and pay tax due by **31 January** following the tax year.([gov.uk](https://www.gov.uk/government/collections/making-tax-digital-for-income-tax?utm_source=openai))
## First Quarterly Update Deadline: 7 August 2026
The deadline for reporting the first quarterly update—covering income & expenses from **6 April to 5 July 2026**—is **7 August 2026** for those with qualifying income over £50,000.([gov.uk](https://www.gov.uk/government/news/deadline-approaches-for-first-making-tax-digital-quarterly-update?utm_source=openai))
## Penalties & Exemptions
- In this first year, **no penalty points** will be issued for late quarterly updates. However, penalties still apply for late Self Assessment returns and late payments.([gov.uk](https://www.gov.uk/government/news/deadline-approaches-for-first-making-tax-digital-quarterly-update?utm_source=openai))
- Exemptions are available—e.g., for people who are *digitally excluded*. Check the official guidance if you believe an exemption applies.([gov.uk](https://www.gov.uk/government/news/deadline-approaches-for-first-making-tax-digital-quarterly-update?utm_source=openai))
## What You Need to Do Now
- If you’re a sole trader or landlord and earned over £50,000 in the 2024-25 year from self-employment and property income, ensure you have compatible software and are signed up and ready to send your update by early August.
- Review all your income sources and expenses from 6 April to 5 July—documents like bank statements, invoices, receipts—as required records via digital records will be needed.
- If acting through an agent (accountant/bookkeeper), delegate preparation now so nothing is missed.
## Example Scenario
**Maria** is a UK landlord whose rental income and self-employment combined in 2024-25 exceeded £50,000. She has been preparing digital records and purchased compatible software. For the first three months of the 2026-27 year, her income and expenses totalled £8,000 income, £2,500 expenses. She inputs these into the software and submits by 7 August 2026. Because it’s the **first year**, no penalty if she’s a few days late—though she still wants to avoid interest or issues with her self-assessment submission.
## Moving Forward: Phased Implementation
- From **6 April 2027**, those with qualifying income over **£30,000** must use MTD.
- From **6 April 2028**, threshold drops to **£20,000**.
- The same rules apply to sole traders or landlords; partnerships & other types of income will be phased in later.([gov.uk](https://www.gov.uk/guidance/get-ready-for-mtd-an-agent-toolkit/understanding-making-tax-digital-for-income-tax?utm_source=openai))
**Bottom Line:** If you're already in scope, the first quarterly update is imminent. Use available time to set up, track records closely, and avoid falling into compliance traps.