MTD for Income Tax: lessons from the first six months

Making Tax Digital for Income Tax has run for six months for sole traders and landlords with qualifying income over £50,000. HMRC says more than 436,000 people sent a first quarterly update, but its own guidance has been rewritten several times to deal with the same questions: cumulative updates, correcting mistakes, update periods and late sign-ups. Those are the lessons to apply now, before penalty points start in 2027-28.

What happened in the first six months?

MTD for Income Tax became mandatory on 6 April 2026. The first quarterly update was due by 7 August 2026 and the second by 7 November 2026.

HMRC’s 12 August announcement gave “more than” figures for both numbers. On those rounded figures, roughly 134,000 people who had signed up had not yet sent a first update. That is our calculation. HMRC’s later notices, on 5 October and 2 November, give no updated numbers.

Lesson 1: quarterly updates are cumulative

Each update covers the tax year so far, not just the latest three months. HMRC added this explanation to its send quarterly updates guidance on 19 May 2026.

So the 7 November update covers 6 April to 5 October, and the 7 February update covers 6 April to 5 January. Your software calculates the totals, and you can check them before sending.

You must still send an update for a period with no income or expenses.

Lesson 2: fix mistakes in the records, not by resending

You do not resend an earlier update to correct it. HMRC’s five things notice of 2 November 2026 says to correct your digital records as soon as you spot an error. The correction then appears in your next update.

Corrections after the fourth update have a later deadline: the tax return filing date.

Lesson 3: choose calendar periods before the first update

Software defaults to standard periods ending on the 5th of the month. Calendar periods end on 30 June, 30 September, 31 December and 31 March, with the same 7th of the month deadlines.

To use calendar periods, you must select them in your software before your first update. Once an update is sent, you cannot change for the rest of the tax year. HMRC’s guidance since 6 January 2026 says anyone with a 31 March accounting period must choose calendar updates before the first update.

Lesson 4: automatic sign-ups need checking

From September 2026 HMRC began signing up people who should be in MTD but had not joined. It uses the 2024-25 return, and the 2025-26 return if already filed.

The income sources HMRC holds can be out of date. Our guide to automatic sign-up covers what to check on the letter and how to send overdue updates.

Lesson 5: agent access needs testing early

HMRC clarified on 24 April 2026 that agents must authorise software with the firm’s agent services account user ID and password. Multi-factor authentication became live on all agent services accounts after the last activation window closed on 15 October 2026.

Agent Update issue 148 advises agents to sign in and confirm access works before they need it. See our guide to the HMRC agent services account.

Lesson 6: deadline day support is thin

The Agent Dedicated Line is closed on Saturday 7 November 2026. The Self Assessment helpline, 0300 200 3310, is open from 9am to 3pm that day, and webchat runs from 8am to 4pm.

HMRC’s advice is not to wait until the deadline. Full phone support is only available during the week.

Penalties: the soft landing ends for the first cohort

There are no penalty points for late quarterly updates in 2026-27. Late tax returns still get points, and you must send the final update before you can file the return.

Budget 2026 gave April 2027 joiners the same easement for 2027-28. ICAEW confirms it was not extended to the April 2026 cohort.

From 2027-28 each late update earns a point, and four points trigger a £200 penalty. See Budget 2026 and MTD.

What to do before April 2027

1. Send any overdue 2026-27 updates now. There is no penalty this year, but the tax return cannot be filed without them.
2. Reconcile the cumulative totals with your bookkeeping each quarter.
3. Check update periods for every client with a 31 March year end before 2027-28 starts.
4. Treat 7 August 2027 as a live deadline. It is the first one that earns points for the April 2026 cohort.
5. Prepare the next wave. HMRC estimates about 1,077,000 more people with qualifying income over £30,000 join on 6 April 2027. See the £30,000 threshold.

Frequently asked questions

How many people sent their first MTD quarterly update?

HMRC said on 12 August 2026 that more than 436,000 sole traders and landlords had sent their first update, and more than 570,000 had signed up.

Are MTD quarterly updates cumulative?

Yes. Each update covers the tax year from 6 April to the end of the update period, so corrections in your records feed into the next update.

Do I need to resend a quarterly update if I made a mistake?

No. Correct your digital records and the change appears in your next update. After the fourth update, corrections must be made by the tax return filing date.

When do penalty points start for the April 2026 cohort?

From 2027-28. The first update that can earn a point is due by 7 August 2027, and four points trigger a £200 penalty.

Can I switch to calendar update periods?

Only before you send your first update of the tax year. After that, you cannot change for the rest of the year.