The August MTD Deadline: What You Need To Know
The First Major Making Tax Digital Deadline Is Approaching
Making Tax Digital (MTD) for Income Tax may have gone live in April 2026, but many sole traders and landlords are now focusing on the first major deadline.
For those affected by the new rules, the first quarterly update must be submitted to HMRC by 7 August 2026.
While HMRC has introduced a soft-landing period for the first year, this deadline remains an important milestone. It is the first real test of whether your bookkeeping records, software, and processes are ready for the new digital reporting requirements.
If you are unsure what the August deadline means for you, here is what you need to know.
Who Does The August Deadline Apply To?
The deadline applies to sole traders and landlords with a combined gross income exceeding £50,000 from self-employment and property income in the 2024/25 tax year.
If you fall into this category, you should already be:
- Keeping digital records
- Using HMRC-compatible software
- Recording income and expenses digitally
- Preparing quarterly updates for HMRC
The first quarterly reporting period runs from 6 April 2026 to 5 July 2026.
Your first update covering this period must be submitted by 7 August 2026.
What Information Needs To Be Submitted?
Your quarterly update is a summary of your business activity during the reporting period.
This includes:
- Total income received
- Total allowable expenses
- Information taken directly from your digital records
- Separate submissions for different income sources where required
The update must be submitted via compatible software. Information cannot simply be entered manually into HMRC.
If you have both self-employed and rental income, separate updates may be required.
Will You Be Fined If You Miss The August Deadline?
For the 2026/27 tax year, HMRC has introduced a soft landing period.
This means late quarterly updates will not receive penalty points during the first year of the scheme.
However, that does not mean the deadline should be ignored.
You are still legally required to:
- Keep digital records
- Submit quarterly updates
- Maintain accurate information
The soft landing is designed to help businesses adjust to the new system, not to delay compliance altogether.
Why August Matters
The August deadline is about more than a single submission.
It marks the start of a completely different way of reporting tax information.
Many businesses have traditionally reviewed their records once or twice a year. Under MTD, record-keeping becomes a routine part of running the business.
The businesses that cope best with Making Tax Digital are not necessarily the largest or the most experienced.
They are the businesses that keep their records consistently up to date throughout the year.
Common Mistakes To Avoid
As the deadline approaches, avoid these common issues:
Leaving bookkeeping until July
Trying to organise three months of records at the last minute increases the risk of mistakes.
Using non-compatible software
Not all bookkeeping systems meet HMRC’s MTD requirements.
Missing transactions
Incomplete records can lead to inaccurate submissions.
Mixing personal and business spending
Clear separation makes bookkeeping easier and improves accuracy.
Assuming there is nothing to do because of the soft landing period
Compliance requirements still apply even though penalty points are not being issued for quarterly updates in the first year.
How Rosemary Bookkeeping Can Help
If you are feeling behind, you are not alone.
Many business owners are still adapting to Making Tax Digital and working out exactly what is required.
Your local Rosemary Bookkeeper can help you:
- Get organised before the August deadline
- Keep accurate digital records
- Use MTD-compatible software
- Stay compliant with HMRC requirements
- Reduce the stress of quarterly reporting
The August deadline is approaching quickly.
The sooner you get your records in order, the easier your first MTD submission will be.
Need Help Before 7 August?
Making Tax Digital does not need to be overwhelming.
With the right support and the right systems, quarterly reporting can become part of your normal business routine.
Find your nearest bookkeeper here, or call us on 0345 8620072
