The first quarterly updates for the quarter ended 30 June or 5 July are due on 7 August. This is for taxpayers with a combined gross income of £50,000 from self-employment and property in the 2024/25 tax year. Additionally, those in scope of MTD for income tax must also submit a digital end-of-year return to HMRC using compatible software following the end of the tax year. Some exemptions are in place.

Taxpayers in scope of MTD for income tax should have received a letter from HMRC to let them know. But regardless of whether taxpayers receive a letter from HMRC, it is the taxpayer’s responsibility to:

• check if they are required to comply with MTD for income tax from April 2026; and
• sign up for MTD for income tax.

Ahead of the filing deadline, ICAEW is urging taxpayers who meet the criteria to sign up now, and advises them to also:

1. Consider authorising a tax agent to act on your behalf. Taxpayers wishing to use an agent to file quarterly updates will need time to identify an agent and ensure they are authorised to act on their behalf. Agents can also sign their clients up to MTD.
2. Ensure you have compatible software ready. Commercial software which is compatible with MTD for income tax will be required to create, store and correct digital records and send quarterly updates to HMRC. Software is also needed for adding other income sources to tax returns. HMRC has a tool available to help taxpayers understand what software they can use and ICAEW also provides resources.
3. Authorise your chosen software. Taxpayers and agents will need to authorise their chosen software to ensure it is connected to HMRC systems.
4. Create digital accounting records for the quarter. If taxpayers in scope for MTD for income tax haven’t done so already, they, or those acting on their behalf, will need to create digital records for the quarter ready for the filing deadline.
5. Decide which reporting quarters to use. Taxpayers can choose whether to report in standard tax quarters or calendar quarters, if they prepare their accounts to 31 March instead of 5 April and their chosen software supports this. If taxpayers wish to report on a calendar quarter basis, this choice needs to be made in the software before submitting the first quarterly update for the year.

It’s also worth noting that some in scope for MTD for income tax may qualify for an exemption. While some exemptions are automatic, some need to be applied for. If taxpayers want certainty that they qualify for an exemption ahead of the first deadline, they should not delay applying for an exemption.

Lindsey Wicks, ICAEW Senior Tax Technical Manager, said:

“Making Tax Digital for income tax is the most significant change to income tax reporting for taxpayers and agents for almost 30 years and it’s important that affected taxpayers understand their responsibilities.

“Taxpayers and agents should sign up to MTD for income tax now to familiarise themselves with the quarterly reporting requirements, and to ensure there is time to deal with any issues ahead of the first quarterly deadline on 7 August.

“Signing up is the opportunity to ensure HMRC has the correct data before it migrates data between platforms in the background. If there are data issues, there could be delays completing the sign-up process, so we recommend starting the sign-up journey well ahead of the deadline.”

ENDS

Notes to editors:

In 2026/27, there will be no penalty points for quarterly updates submitted late. However, a penalty point will apply if the 2026/27 year-end return is submitted late. A £200 fine will be applied once a taxpayer reaches four penalty points.

The MTD income tax start date for those with combined gross qualifying income over £30,000 in 2025/26 is April 2027 and April 2028 is the start date for gross qualifying income exceeding £20,000 in 2026/27.

For more information, visit ICAEW’s Making Tax Digital hub or read an explainer on Making Tax Digital.