Making Tax Digital (MTD) for Income Tax will change how millions of taxpayers report their income. If you are a sole trader or landlord, understanding the new quarterly reporting process and year-end requirements is essential, particularly if your qualifying income is over £50,000 and you will need to comply with MTD from 6 April 2026.
MTD quarterly reporting – What you need to know
Under MTD, you will need to submit four quarterly updates each tax year using HMRC-approved software. These updates provide a snapshot of your income and expenses.
Reporting periods and deadlines
By default, quarters align with the tax year:
Quarter
Period covered
Deadline
1
6 April to 5 July
7 August
2
6 July to 5 October
7 November
3
6 October to 5 January
7 February
4
6 January to 5 April
7 May
You can opt to choose calendar quarters (30 June, 30 Sept etc) instead, but deadlines remain the same.
What information is included in quarterly submissions?
Total income and expenses for the year to date
Categorised figures (similar to self-assessment boxes)
For smaller businesses simplified accounts are allowed, e.g., total income, total expenses, net profit
Each business or property income stream requires its own quarterly update.
Year-end submission – Final Declaration
After your four quarterly updates, you will need to complete a Final Declaration. This replaces the old Self-Assessment tax return.
This will include:
Confirmation of all income and expenses for the year
Other income (e.g., interest, dividends)
Adjustments and reliefs
The Final Declaration must be submitted by 31 January following the end of the tax year (for example, 31 January 2028 for the 2026–27 tax year).
When will MTD affect you?
If your qualifying income is over £30,000 you will be affected by Making Tax Digital from April 2027. The threshold will drop to £20,000 in April 2028, meaning more people will be required to keep digital records and submit quarterly returns to HMRC.
Please get in touch if you would like further information or support in preparing for MTD by calling 0808 144 5575 or email help@armstrongwatson.co.uk.
