Making Tax Digital: second quarterly update due 7 November

Sole traders and landlords who joined Making Tax Digital (MTD) for Income Tax in April must send their second quarterly update by 7 November 2026. It covers 6 April to 5 October: the whole tax year so far, not just the last three months.

This first wave is sole traders and landlords whose income from self-employment and property came to more than £50,000 in 2024/25. HMRC counts that income before expenses, so it is turnover, not profit, and it adds the two together. HMRC's own example is £27,000 of takings and £25,000 of rent: £52,000, and in.

Each update covers the year to date

A quarterly update is a summary, not a tax return. Your software adds up your digital records and sends HMRC a total for income and for each expense category, using the same categories as Self Assessment. HMRC does not see individual receipts or invoices.

You send one for each business. A plumber who also lets a flat sends two: one for the trade, one for the property.

Because every update runs from 6 April, a mistake in the summer figures is put right by correcting the record before this update goes. You do not resend the first one.

Illustration, not a real client. A self-employed decorator in Walthamstow sent takings of £14,000 for 6 April to 5 July. The November update shows takings from 6 April to 5 October, say £29,500, not the £15,500 earned since July. If a £600 job from June was missed in August, recording it now puts it into the November total.

If nothing came in and nothing went out, you still send the update.

No penalty points this year, with a catch

HMRC will not apply penalty points for late quarterly updates in the 2026/27 tax year. That is real breathing room, and it is narrower than it sounds:

• you must still send the quarterly updates before you can submit your 2026/27 tax return;

• penalty points still apply if your 2026/27 tax return, due by 31 January 2028, is late;

• from 2027/28, a late update earns a point, and four points bring a £200 penalty.

So a late 7 November update carries no penalty point. Leaving every update until January 2028 means rebuilding a year of records against the return deadline. Our guide to what the first-year soft landing does and does not cover sets out the detail.

What to check before you send

• Everything is in the software. Every sale, rent payment and cost from 6 April to 5 October, not only what arrived through the bank feed. HMRC warns that some transactions may not appear in full in a feed.

• The categories are right. Each item sits in the Self Assessment category it will end up in.

• Records are digitally linked. If you use more than one product, the data must move by link, import or file transfer. Once a record has been sent, HMRC says you must not copy it across by hand or cut and paste it.

• Joint lets. If you let a property jointly, you can include the income only and report its expenses after the year ends.

• Calendar periods. If your accounts run from 1 April to 31 March, you may be using calendar periods. This update then covers 1 April to 30 September, and the deadline is still 7 November.

For landlords, our explainer on what goes into a quarterly update lists what to include and what to leave for the year end.

What to do before 7 November

1. Open your software and check it shows an update for the period to 5 October for each business.

2. If the August update did not go, sort it out now rather than in January. HMRC will want the quarterly updates before it accepts your return.

3. Read the tax estimate you get after sending. It is a forecast, not a bill. MTD does not change when tax is paid: the 31 January and 31 July payment dates stay as they are.

4. Put 7 February 2027 in the diary for the third update, covering 6 April to 5 January.

The full timetable is in HMRC's quarterly update guidance. And if your turnover from self-employment and property was over £30,000 in 2025/26, the return you file by 31 January 2027 is the one that brings you into MTD from 6 April 2027. Check where you stand with HMRC's eligibility guidance before you file.

About the author

Harvey Dhillon is the founder and CEO of Zmartly, a UK accountancy firm for small businesses. He grew up in West London and worked in finance roles in investment banking, wealth management and private equity, starting at Barclays, before leaving in 2020 to build the firm. He is a Chartered Management Accountant (ACMA, CGMA).

Featured photo by Ben Hadfield on Unsplash.