If you are a sole trader or property owner facing your Making Tax Digital (MTD) quarterly Income Tax update, you may find the basics: the first one is due on 7 August 2026, and you send it through your software.
But focus on the details and the MTD is full of quirks, easements and shortcuts that no one talks about—many of which make your life easier, not harder.
Here are 10 of the best—and a few bonus introductions that can save you a headache. At least one of them will save you time this quarter.
Here’s what we’re talking about:
1. You can file up to 10 days before the end of the quarter
Here’s what almost no one knows: HMRC allows you to submit a quarterly review up to 10 days before the review period ends—as long as you’re sure no more transactions will take place during those last days.
Are you out on vacation? Finishing before a busy season? You could have submitted your first review as early as June 26th and spent the deadline week thinking about anything else. It should be remembered on the last days of the second, third and fourth quarter.
2. Your digital records don’t have to be “live”
MTD requires you to keep your records digitally—but it doesn’t require you to keep them live in real time.
Sitting down before each quarter’s deadline and submitting everything in one batch is perfectly within the rules.
That said, it’s a bit and usually a smart practice.
Connect your bank feed, instant receipts on the go, and the quarterly update stops being a chore at all—it can be a five-minute update.
But if life gets in the way one quarter, you’re not breaking any rules by participating.
Bonus tip #1: There is free MTD software (and that’s free, forever)
Sage Sole Trader lets you do everything you need to get MTD for Income Tax—and Sage Sole Trader Free is a zero-cost forever, Making Tax Digital (MTD)-friendly app designed for non-VAT-registered sole traders.
It does everything you need. Yes, indeed.
Here’s what you need to do to submit a quarterly update, even if you haven’t done anything at all to MTD or your accounting so far in the tax year:
- Download Sage Sole Trader. There are mobile apps, as well as desktop.
- Create an account and login.
- Connect your business bank account, and import your transactions.
- Use the categorization tool to categorize transactions with just a swipe, when using the app. The app will help automatically categorize, too!
- If you’ve bought anything in cash, or if you’ve made payments in cash, create your own transactions using data from receipts you’ve received, or invoices you’ve created.
- Open your quarterly review, review it, and tap to send it to HMRC.
That’s all. The work is done. It’s free. Now you can get back to doing what you love the most.
3. There are no late filing penalties for this first year
HMRC has confirmed a soft landing: no penalty points will be issued for the latest quarterly review in the 2026/27 tax year for those approved from April 2026.
Don’t take that as an invitation to skip updates! That would be bad.
They all still need to be submitted before you finish your year, and the points system starts properly from 2027/28.
But it means your first year is a real practice game.
4. Nothing to pay on August 7th
A quarterly review is a summary of your income and expenses.
It’s not a tax credit, and it doesn’t change when you pay taxes—your pay dates stay where they always have been.
So, a deadline costs you a few minutes in your software, and not a penny in your bank account. (Although you have previously agreed with HMRC to pay on account by 31 July, that has not changed.)
5. You can update your statistics after submitting
Each update is cumulative: it covers everything from the beginning of the tax year to the end of that quarter, not just the most recent three months.
Do you see missed expenses from May to September? It just flows into your next review, and everything is finalized by the end of the year.
Even better, penalties for mistakes like these don’t apply to quarterly reviews. Always.
The goal for each quarter is complete and logical—not analytical—complete. Post, move forward, run your business.
(To be clear, HMRC requires you to be as accurate and complete as possible in your returns. None of the above is a get-out-of-jail-free card. But it’s good to know that accidental or inadvertent errors can be corrected.)
6. Under £90,000? You only need two totals
If your turnover is below the VAT registration threshold of £90,000, you qualify for what are known as “triple line accounts”.
Instead of splitting all expenses into categories for HMRC, your digital records only need to separate income from expenses—and your quarterly review reports just those two totals.
That can be a significant admin saver for small businesses and homeowners.
Your software can still analyze everything in the background if you want a richer understanding, and perhaps the most important thing to remember is that you will still need to have those digital records of income and expenses during the quarterly review.
7. You can choose the days of the quarter that suit you
The usual review periods follow the tax year: 6 April to 5 July, and so on.
But if the end of the month suits your bookkeeping better, you can choose to use calendar quarters instead—1 April to 30 June for the first quarter—with the exact same deadlines.
One catch: you must make an election before you submit your first tax year return and notify HMRC. So if you’ve already installed them, it’s one to remember next April.
8. Each source of income gets its own review—even the silent one
If you are both a sole trader and a property owner, you do not submit one consolidated review. You send one for each source of income, each quarter. Good software makes this painless, but it’s worth knowing so a second deadline will never catch you.
Keep an eye on both sets of statistics as the quarter closes, and let your software’s reminders remind you.
And yes, if you own two businesses and own a property, that’s a three quarter review.
9. Co-owners can defer expenses until the end of the year
Do you have a rental property with someone else?
A dedicated easement allows you to report your share of income each quarter and incur expenses once, at the end of the year (subject to the appropriate conditions being met). Therefore, there is no division of the boiler to repair four times a year.
Combine it with three line accounts (if your property income is less than £90,000) and your entire quarterly liability for a shared property can be reduced to a single income figure.
That’s about as easy as a tax administrator gets.
10. Every review gives you a free tax estimate
Here’s the opposite of what no one says: once you submit an update, you go back to the annual estimate of your tax position based on the figures to date.
For the first time, you’ll know what the January bill might look like—but in August, there’s time to put money aside, speed up your cash flow, or talk to an accountant while there’s still time to act. (Though don’t forget that your final tax may take into account other sources of income such as interest or pensions, as well as exemptions or adjustments—and this may affect the final amount.)
The old system told you what you owed after the end of the year. This one tells you when you can do something about it. If used correctly, that measurement can be the most valuable thing MTD has to offer.
Bonus tip #2: The £0 quarter still needs an update
Someone to file under “what you need to know before it bites”: not getting paid a quarter doesn’t mean you can’t do anything.
If you’re registered for Income Tax MTD, all sources of income require a quarterly update—and if there’s no work, that means no update. It takes seconds for your software, but it needs to happen.
The same concept applies on a larger scale. Whether you’re included in the MTD rules is based on your past qualifying income, so a quiet year—a rental property between tenants, a business you’ve closed—doesn’t automatically disqualify you from the program.
Your income needs to stay below the threshold for three consecutive tax years before you can leave MTD with Income Tax behind, and if you stop trading altogether, you should tell HMRC rather than just keep quiet.
Until then, keep those updates fresh: they’re the easiest senders to make, and they keep your record clean.
Final thoughts
The Income Tax MTD has a reputation as an extra manager, but look closely and the system is full of easements designed to keep it simple: early filing, collection record keeping, simplified sums, flexible areas and the first year without penalties for late filing.
So don’t just comply. Take control. Choose the adjustments that fit your situation, link your bank feeds so future settlements work automatically, and start using that quarterly tax estimate to plan ahead.
Ten minutes now, four times a year, in exchange for the chance to never be surprised by a tax bill again. That’s a trade-off worth making.
Frequently Asked Questions
The first quarterly review deadline is 7 August 2026. It covers 6 April to 5 July 2026 (or 1 April to 30 June if you have selected calendar settlements) and is submitted via MTD compatible software, not the HMRC website.
No. The quarterly review is a summary of income and expenses only. Your tax due dates haven’t changed—for most people, that’s January 31, and account payments where they apply.
HMRC has confirmed that there are no late submission penalty points for quarterly reviews in 2026/27 for those approved from April 2026. You must still submit a review at the end, as your year cannot be completed without it, and the penalties apply as normal from 2027/28.
Not if your net worth is less than £90,000. Under the ease of three-line accounts, your digital records and quarterly updates only need the total amount of income and expenses, without classification.
For the year 2025/26, yes—that refund is still due on 31 January 2027 under the old rules. From 2026/27 onwards, your four quarterly reviews are completed with your year-end tax return (due by 31 January 2028 for the first year), where you make final adjustments and claim allowances.
