There is one point about MTD quarterly updates that causes more confusion than anything else: each update is cumulative.
It does not cover only the most recent three months.
What cumulative means in practice
Under Making Tax Digital for Income Tax, each quarterly update covers from the start of the tax year to the end of the relevant update period.
So if you use the standard quarterly periods, your second update covers:
6 April 2026 to 5 October 2026 — not just July to October
And if you use calendar quarters, it covers 1 April 2026 to 30 September 2026 — not just July to September.
The standard deadlines
| Quarter | Period end | Deadline |
|---|---|---|
| Q1 | 5 July 2026 | 7 August 2026 |
| Q2 | 5 October 2026 | 7 November 2026 |
| Q3 | 5 January 2027 | 7 February 2027 |
| Q4 | 5 April 2027 | 7 May 2027 |
Why cumulative reporting is actually helpful
It sounds like more work. In one important respect it is less.
Because each update restates the year to date, corrections made to your digital records flow through into the next update automatically. You do not have to resubmit an earlier one to fix an error. If something was miscategorised in quarter one, correcting it in your records means quarter two reports the corrected position.
A quarterly update is not another tax return
This is worth being clear about, because the word “submission” makes people expect far more than is required.
A quarterly update is a summary of the income and expense information recorded in your compatible software for each relevant self-employment or property business. HMRC says you do not need to make accounting or tax adjustments before sending it.
Allowances, reliefs, adjustments and other income are dealt with at the end of the year, when you finalise and submit your return.
The real question before a deadline
So the question is not simply “have I submitted the update?” It is:
- Are your records up to date?
- Has all your income been recorded?
- Have your business expenses been captured?
- Is your software ready to submit?
MTD is designed around keeping digital records throughout the year rather than reconstructing everything when a deadline arrives. If your bookkeeping has not been kept up since April, a quarterly deadline means working through several months of records at once — which is exactly the situation MTD was meant to prevent.
Penalties in the first year
For 2026/27, HMRC is not applying late-submission penalty points to quarterly updates during this first mandatory year, although the reporting requirement still applies. The easement does not extend to the year-end return, and it will not apply to those joining at lower thresholds in later years.
Relying on it is a short-term position. The records still have to exist.
What to do now
A deadline may feel a little way off. But if your records are not ready, dealing with them now is considerably easier than in the first week of the deadline month.
For the wider picture of what MTD involves beyond the quarterly updates, see Making Tax Digital isn’t just four updates a year.
If you are unsure whether MTD for Income Tax applies to you, or whether your records are ready for the next update, book a consultation.
This article sets out general information and is not advice for your circumstances. MTD rules and deadlines change.
