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If Making Tax Digital for Income Tax (MTD For IT) applies to you, what changes is how you report, not what your annual return is. For any tax year in which MTD applies, your return must be submitted through MTD compatible software (software that can send your updates and return to HMRC), and the final declaration is not an extra return on top of it.
This guide to MTD quarterly reporting explains what each part involves, how the two fit together across the tax year, and what it means in practice for landlords.
Who Has to Send MTD Quarterly Updates?
MTD for Income Tax became mandatory from 6 April 2026 for sole traders and landlords whose qualifying income for 2024/25 was more than £50,000, subject to exemptions. The threshold falls to more than £30,000 from April 2027 and more than £20,000 from April 2028.
Qualifying income is broadly your combined gross income from relevant self employment and property activities, before expenses are taken off. It is not your taxable profit. It is also not the total of all your income from every source.
In 2024/25, a landlord receives £52,000 in gross rent and makes a profit of £20,000 after expenses. The £52,000 is the figure that matters, not the £20,000. If that £52,000 is their qualifying income and no exemption applies, MTD applies to them from 6 April 2026.
There are also a number of exemptions and easements (special rules that relax the normal requirements) set out in law. So crossing a threshold is not the whole story. Check your own position before assuming MTD does or does not apply.
What Is an MTD Quarterly Update?
An MTD quarterly update is a summary of the digital records you keep for your property or business income. Every three months, your software adds up your digital records to create totals for each income and expense category you have used. It is not a Self Assessment tax return.
You do not normally need to make accounting or tax adjustments (changes to your figures to reflect accounting or tax rules) before sending a quarterly update. Adjustments of that kind can be dealt with before you submit your annual return, final declaration.
MTD uses the same income and expense categories as Self Assessment, set out in HMRC's quarterly update direction. HMRC does not receive details of individual records, such as receipts or invoices..
If you have more than one self employment business covered by MTD, separate quarterly updates may be needed, so do not assume everyone makes exactly four submissions a year.
However, several UK properties are generally treated as one UK property business, so only one quarterly update is required for the whole UK property business rather than a separate update for each property.
If you had no income or expenses during an update period, you must still send your quarterly update to tell HMRC.
If You Jointly Let Property
For jointly let properties, you can choose to include either your property income and expenses, or your property income only, in your quarterly updates. If you leave out the expenses, you must report them after the tax year ends by resending your fourth quarterly update.
HMRC says you should do this before making any tax adjustments and before you submit your tax return. Any properties you own solely still need both income and expenses in your quarterly updates.
MTD Quarterly Update Deadlines and Periods
The four quarterly update deadlines are 7 August, 7 November, 7 February and 7 May. Standard update periods normally run from 6 April, the start of the tax year.
Standard Periods
Update | Period covered | Deadline |
|---|---|---|
1 | 6 April to 5 July | 7 August |
2 | 6 July to 5 October | 7 November |
3 | 6 October to 5 January | 7 February |
4 | 6 January to 5 April | 7 May |
Calendar Quarter Periods
You can instead elect (formally choose) to use calendar quarters, with periods ending on 30 June, 30 September, 31 December and 31 March. The filing deadlines stay the same.
Period ending | Deadline |
|---|---|
1 April to 30 June | 7 August |
1 July to 30 September | 7 November |
1 October to 31 December | 7 February |
1 Janaury to 31 March | 7 May |
Calendar periods are also cumulative, normally running from 1 April.
To use them, you need to select calendar update periods in your software for each source of income before you send your first quarterly update.
They then continue to apply unless you switch back to standard update periods, but you cannot change the update periods for a tax year once you have sent a quarterly update for that year.
Why Quarterly Updates Are Cumulative
Quarterly updates are cumulative, which means each one shows your running total for the year so far. If your business runs for the whole tax year and you use standard update periods, each update covers the period from the start of the tax year, not just the latest three months.
Worked Example
A landlord's rent received over the year builds up like this. The figures are illustrative only.
Update | Period covered | Rent received in those three months | Total shown in the update |
|---|---|---|---|
1 | 6 April to 5 July | £13,000 | £13,000 |
2 | 6 April to 5 October | £13,000 | £26,000 |
3 | 6 April to 5 January | £12,500 | £38,500 |
4 | 6 April to 5 April | £13,500 | £52,000 |
Each update builds on the one before, so the fourth update shows the full year's figure.
What Is the MTD Final Declaration?
The MTD final declaration is a name you may see for finalising and submitting your annual Self Assessment tax return. In MTD law, the filing declaration is still the ordinary Self Assessment return (the return required under section 8 of the Taxes Management Act 1970).
So there are not four quarterly returns plus a fifth return at the end. There are quarterly updates, which are summaries, and there is one annual tax return. Your quarterly updates do not take its place.
The final declaration is due by 31 January following the end of the tax year. For example, for the 2026/27 tax year (6 April 2026 to 5 April 2027), the deadline is 31/01/2028.
What Happens Between Your Last Quarterly Update and Your Final Declaration?
Once you have sent your fourth quarterly update, HMRC will have your self employment and property income and expenses for the tax year, for every business you have. You then use your software to finish your year end figures before you complete and submit your annual return.
Adjustments You May Need to Make
Depending on your circumstances, this could include:
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Most adjustments are made by changing the annual total for an expense category in your software, so you do not need to change every individual transactions.
Correcting Your Records
If you find an error in your digital records at any point in the year, you need to correct it as soon as possible. After the year ends, you may need to resend your fourth quarterly update if your records change. For example, you may need to:
correct an error you have found;
add expenses for jointly owned property that you did not include in earlier updates; or
record Rent-a-Room income, if you decide to claim the relief after the tax year ends.
Completing Your Annual Return
Finally, you report any losses, add any other income and gains that must be reported, check the information and submit your tax return through your MTD compatible software.
It is sensible to leave enough time before the 31 January deadline to review everything, with your accountant if you have one.
Quarterly Updates vs Final Declaration: Side by Side Comparison
In short, quarterly updates are running summaries of your records, and the final declaration is where your tax year is finalised.
Quarterly updates | Annual return (final declaration) | |
|---|---|---|
What it is | A summary of your digital records | Your annual Self Assessment tax return |
How often | Four deadlines a year, for each relevant business | Once a year |
Period covered | A running total for the year so far, normally from 6 April (standard periods) or 1 April (calendar periods) | The full tax year |
Adjustments | Not normally needed | Any applicable adjustments made before submission |
Other income and gains | Not included; covers the relevant business or property records | Included where they must be reported on the return |
Deadline | 7 August, 7 November, 7 February, 7 May | 31 January following the tax year |
How it is sent | Through MTD compatible software | Through MTD compatible software |
Does MTD Mean Paying Tax Every Quarter?
No. MTD does not itself introduce quarterly Income Tax payments. Your quarterly updates report figures to HMRC; they are not tax bills. The annual return remains due by 31 January following the tax year.
After you send an update, you can see an estimate of your tax bill for your self employment and property income in your software or your HMRC online services account. HMRC includes other information it already holds, such as employment income taxed through PAYE. The estimate will be less accurate if you have other income HMRC does not yet know about, or if your accounting period does not match the tax year.
Depending on your software, you may be able to record other income during the year, such as savings interest. This income is not part of your quarterly updates, but recording it gives you a more complete estimate. If you do not record it during the year, you need to add it before you submit your tax return.
MTD Penalties: What Happens If You File Late?
In 2026/27, late quarterly updates do not get penalty points, but a late annual return can. After that, both generally count towards the same MTD penalty points system, where a missed deadline can earn a point.
Late quarterly update | Late annual return | |
|---|---|---|
2026/27 | No penalty points. The updates are still required and must be sent before you can submit your tax return. | Penalty points still apply. |
2027/28 onwards | A missed deadline can generate a penalty point. | A missed deadline can generate a penalty point. |
Once you reach the threshold of four points, a £200 penalty can arise. The 2026/27 relaxation covers quarterly updates only.
MTD Quarterly Reporting for Landlords: A Year Step By Step
Here is how the 2026/27 tax year could look for a landlord who is in MTD. It assumes their 2024/25 qualifying income was more than £50,000, no exemption applies, and they use standard update periods.
Conclusion
MTD quarterly reporting adds a new rhythm to your tax year, but it does not change what your annual tax return is. Quarterly updates are running summaries of your digital records, sent by 7 August, 7 November, 7 February and 7 May. Your annual Self Assessment tax return, sometimes called the final declaration, is still where your year is finalised, and it is still due by 31 January.
If you are a landlord within MTD, the most useful thing you can do is keep your records up to date as the year goes on. Accurate records make each quarterly update straightforward, leave less to sort out at year end, and give you time to review your position with your accountant before the deadline.
