What Happens If I Miss the MTD Income Tax Quarterly Update Deadline?

Are you a sole trader or landlord? Then you might already be aware of Making Tax Digital for Income Tax (MTD IT). It’s changing the way certain people need to report their income throughout the year.

Rather than submitting a tax return each year, some sole traders and landlords must now also submit regular quarterly updates to HMRC, keeping them informed.

In this article we’ll look at how these deadlines measure up to your end-of-year tax return, and explain what happens if you miss one.

What is Making Tax Digital for Income Tax?

MTD for IT is the next phase of the government’s Making Tax Digital scheme, which is slowly being rolled out and will gradually take over from the current Self Assessment system for some taxpayers.

In April 2026, it replaced the Self Assessment process for some sole traders and landlords who need to report the income they get from self-employment and property.

Who needs to register?

As it’s still being rolled out, you might not need to register for MTD rules straight away. You can start using MTD voluntarily, but it’s very important to check you’re not casually ignoring it if you should be using it.

How do I check if I need to use MTD Income Tax?

To get started, add together all the qualifying income you receive from being a sole trader and/or from property. So, who needs to register?

Remember: you’re only looking at your qualifying income here. That means the total of your self-employment and/or property income – not everything you might earn, such as dividends or wages.

How does it work?

In order to comply, you have to keep digital records for all the transactions in your business, use approved MTD software or bridging software to send HMRC updates of your business’s income and expenses on a more frequent basis (i.e. quarterly), and make a final submission at the end of the year, separately to your four quarterly updates.

This final submission will include all your other income, too, so it’s more like a traditional Self Assessment. It’s also an opportunity to make any final adjustments or changes to your updates.

When are the deadlines for quarterly updates?

The deadline to send a quarterly MTD IT update to HMRC is the 7th day of the month following the end of the period in question.

For example, the first MTD Income Tax quarter runs 6th April – 5th July, and so the reporting deadline is 7th August.

If you use MTD for IT in the 2026/27 tax year, your quarterly deadlines will be:

You’ll then have until 31st January in the following year to submit your MTD for Income Tax Return (the same deadline as a Self Assessment).

The standard update periods follow the tax year (6th April – 5th April), although you can opt to send calendar updates which end on the last day of the month if you’d rather.

Are there penalties for missing a quarterly update?

It’s expected that MTD Income Tax will move to a points-based system for late submissions. Right now, though, penalties aren’t being issued if you’re late submitting a quarterly update, and this is because MT for IT is still in the testing phase, which lasts until the end of the 2026/27 tax year.

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