Tax & Finance · Polar Small Business Update

Making Tax Digital: missed the first quarterly update? What to do now

The first Making Tax Digital for Income Tax quarterly deadline has passed. If you are a sole trader or landlord who should be using the new system, here is what matters now — without the tax jargon.

Published 21 August 2026 · Last checked 21 August 2026

Polar in 30 seconds: If your qualifying income from self-employment and property is more than £50,000, Making Tax Digital for Income Tax became mandatory from April 2026. The first quarterly update was due on 7 August. If you missed it, you can still submit it now, and HMRC says no penalty points will be issued for late quarterly updates during the 2026–27 tax year.

What changed?

Making Tax Digital for Income Tax is now live for many sole traders and landlords.

From 6 April 2026, people with qualifying income of more than £50,000 from self-employment, property income, or both became required to keep digital records and use compatible software to send quarterly information to HMRC.

For most people using the standard quarterly periods, the first update covered the period from 6 April to 5 July 2026 and was due by 7 August 2026.

HMRC announced on 12 August that more than 436,000 sole traders and landlords had already submitted their first quarterly update.

HMRC also confirmed that from September 2026 it intends to begin signing up, in stages, customers who should already be using Making Tax Digital for Income Tax but have not yet done so.

Does this affect you?

It may affect you if you are registered for Self Assessment and your total qualifying income from self-employment and property is more than £50,000.

The threshold is based on qualifying income before expenses rather than business profit.

From April 2027, the threshold is due to reduce so that people with qualifying income of more than £30,000 will also be brought into Making Tax Digital for Income Tax.

There are exemptions in some circumstances, including for people who are digitally excluded, so anyone unsure whether the rules apply to them should check the latest HMRC guidance or speak to their accountant or tax adviser.

What if you missed the 7 August deadline?

The important point is: do not ignore it.

HMRC says customers who have not yet sent their first quarterly update can still submit it using recognised compatible software.

During the 2026–27 tax year, HMRC will not issue penalty points for late quarterly updates.

That does not mean every tax deadline has become penalty-free. Normal rules around late Self Assessment returns and late tax payments still apply.

Important distinction: a Making Tax Digital quarterly update is not your tax return. It is a summary created from your digital business records. Self Assessment still matters, and the usual tax-return and payment responsibilities do not disappear.

What should you do now?

Check whether your qualifying income puts you inside Making Tax Digital.
If you are required to use it but have not signed up, check your position with HMRC now.
Make sure you are using Making Tax Digital-compatible software.
Bring your digital income and expense records up to date.
If the first update is outstanding, submit it rather than waiting for HMRC to contact you.
Put the next quarterly deadline — 7 November 2026 — somewhere you will not miss it.

One useful change to understand

HMRC’s current guidance says quarterly updates are cumulative.

In simple terms, each update covers information from the start of the tax year through to the end of that update period. That means corrections to earlier digital records can flow into the later update rather than requiring you to keep resending previous quarterly updates.

Your accounting software should guide you through the process, but it is still worth understanding what is being submitted on your behalf.

When are the next deadlines?

For people using the standard update periods, the next quarterly deadline is 7 November 2026, followed by 7 February 2027 and 7 May 2027.

Your software or accountant may help you keep track of these dates, but the responsibility for meeting the requirements remains important.

How Polar can help

Making Tax Digital is another reason why keeping business finances organised throughout the year matters more than trying to reconstruct everything at the last minute.

Polar Accounts brings invoices, expenses, cash flow, credit control and day-to-day money management into the wider Polar business journey.

If you are still setting the business up, our small business setup guide also helps you work through tax, registration and the other practical foundations that need to be in place.

You can also explore all Polar small business tools.

The Polar view

Making Tax Digital is a substantial change, but the practical principle behind it is simple: keep good digital records as the business operates, rather than trying to rebuild the financial picture months later.

If you missed the first update, the useful response is not panic. Check whether you are in scope, get the records organised and deal with the outstanding update now.

Official sources checked:
HM Revenue & Customs — “436,000 sole traders and landlords make their tax digital”, published 12 August 2026.
HMRC — Making Tax Digital for Income Tax guidance, updated July 2026.
HMRC — Quarterly update deadlines for Making Tax Digital for Income Tax.

This Polar Update provides general information, not individual tax or accounting advice. Tax rules depend on personal circumstances and can change. Check current GOV.UK guidance and speak to HMRC, an accountant or a qualified tax adviser where appropriate.