Last reviewed: 29 September 2026 · Reviewed by IFM's qualified accountant
Accurate digital records remain essential even though HMRC says it will not apply late quarterly-update penalty points in 2026/27. All required updates must be sent before the final 2026/27 tax return can be submitted.
What should you know about standard and calendar periods?
Standard update periods align with the tax year. For 2026/27 they run cumulatively from 6 April 2026 to 5 July 2026, 5 October 2026, 5 January 2027 and 5 April 2027.
Calendar update periods run cumulatively from 1 April 2026 to 30 June 2026, 30 September 2026, 31 December 2026 and 31 March 2027. Both patterns share the same deadlines: 7 August, 7 November, 7 February and 7 May.
Calendar periods can simplify records for a business using a 31 March year end. Select them in compatible software before sending the first update for each source; HMRC says the choice cannot be changed for that tax year after an update has been sent.
What should you know about cumulative means from the start?
The second update is not merely July to September. It covers the start of the year through the second period end. The fourth contains totals for the whole update year.
This allows corrections to earlier digital records to flow into the next cumulative update without resending every prior update. It also means a faulty opening period can distort later totals if the underlying records are not corrected.
Keep a snapshot or submission receipt for each update and reconcile the cumulative movement to the ledger.
What the update contains?
Compatible software totals digital records into HMRC's income and expense categories. The update is a summary, not a copy of every invoice or receipt. Each sole trade and property source normally has its own update obligation.
The records behind it should include transaction date, amount and category. Keep invoices, receipts, bank evidence and explanations under the ordinary record-retention rules.
Quarterly updates generally do not require year-end accounting adjustments, private-use adjustments, capital-allowance claims or final reliefs. Those are dealt with during the finalisation and tax-return process where applicable.
What should you know about jointly let property?
For jointly let property, HMRC allows the quarterly update to include the person's property income and expenses or income only. If expenses are omitted, they must be reported after year end by resending the fourth update before the tax return.
That option does not remove the need to keep expense records. Solely owned properties still require the appropriate income and expense information.
Agree ownership shares and the treatment with all owners and agents. One person's software submission does not automatically complete another owner's obligation.
When an update can be sent?
An update can normally be sent after the period ends and before its deadline. HMRC also allows an update up to ten days before period end where no further transactions are expected.
Early submission can help around absence, but it should not omit predictable receipts or payments merely for convenience. If a later transaction belongs in the period, correct the digital record so the next cumulative update includes it properly.
Set an internal cut-off at least two weeks before each deadline. Use the intervening time to finish bank feeds, identify cash transactions, clear suspense balances and obtain approval.
What the estimate means?
After an update, software or HMRC may show an estimated tax figure. It can be useful for reserving cash, but it is not the final bill. It may exclude accounting adjustments, other income, losses, allowances, pension contributions, gains and later transactions.
Do not distribute or spend cash solely because a quarterly estimate is low. Build a separate tax forecast using the complete expected annual position.
No payment is generally triggered just because an MTD quarterly update is filed. The ordinary Self Assessment balancing-payment and payment-on-account dates continue unless HMRC specifies otherwise for the person.
What should you know about missing a 2026/27 update?
HMRC's 2026/27 easement means it will not apply penalty points for late quarterly updates in that first year. Penalty points can still apply to late tax returns, and later tax years move into the ordinary quarterly points system.
Send the late update as soon as the records are ready. A later cumulative update may satisfy information for an earlier missed period under the system rules, but the software and HMRC status should be checked.
Do not leave all four updates until January 2028. The final return cannot be submitted until quarterly obligations are complete, and unresolved records will make the year-end calculation less reliable.
What should you know about corrections?
Correct the transaction in the digital records. The next cumulative update will generally reflect the corrected total. For errors found after the fourth update, follow the finalisation or resubmission process in the software and HMRC guidance.
Document why a material figure changed and retain the original evidence. Do not overwrite a transaction merely to force the software total to match an estimate.
If an update was assigned to the wrong income source, contact the software provider or HMRC before duplicating or deleting submissions.
What should you know about a quarterly control list?
For each source, confirm bank reconciliation, cash income, sales platforms, unpaid invoices under the chosen basis, expense evidence, private items and category mapping. Review new assets, loans and transfers separately so they are not reported as ordinary income or expense.
Confirm that the software acknowledgement names the right taxpayer, source, period and status. Save a copy outside the live software where practical.
After filing, update the full-year forecast and reserve cash. Record the next internal cut-off rather than only the statutory date.
What should you know about finalisation after the fourth update?
The 7 May 2027 fourth-update deadline is not the final 2026/27 tax-return deadline. After the year, calculate adjustments, add other income and gains, make claims and submit the final return by 31 January 2028.
See sole trader and landlord support for the relevant service page. Use the Deadline Finder for standard first accounts, first confirmation statement and Corporation Tax dates. For VAT, payroll, personal tax and other obligations, check the tax deadlines calendar and your official records.
What should you know about responsibilities when an agent helps?
Agree who maintains daily digital records, who resolves bank-feed questions and who approves the cumulative totals. Set dates for the client to provide missing evidence before the agent's internal deadline.
The taxpayer should receive the submission receipt and understand that an estimate is not the final bill. The agent should document any excluded year-end adjustments and list information still needed for the final return.
If either party changes software or access, test authorisation before the next deadline. A signed engagement does not itself connect the product to HMRC or supply the records.
What should you know about year-one lessons?
After every 2026/27 update, record how many items were missing, how long reconciliation took and which categories caused corrections. Improve the next cut-off instead of accepting the same delay.
After the fourth update, reconcile cumulative income and expenses to the year-end ledger before making tax adjustments. Preserve both the update totals and final figures so differences can be explained.
The first-year penalty easement ends; it should be used to build a reliable process, not create a backlog that carries into later years.
What should you read next?
Use the Deadline Finder for standard first accounts, first confirmation statement and Corporation Tax dates. For VAT, payroll, personal tax and other obligations, check the tax deadlines calendar and your official records.
What do people also ask about this topic?
What should you know about standard and calendar periods?
Standard update periods align with the tax year. For 2026/27 they run cumulatively from 6 April 2026 to 5 July 2026, 5 October 2026, 5 January 2027 and 5 April 2027.
What should you know about cumulative means from the start?
The second update is not merely July to September. It covers the start of the year through the second period end. The fourth contains totals for the whole update year.
What the update contains?
Compatible software totals digital records into HMRC's income and expense categories. The update is a summary, not a copy of every invoice or receipt. Each sole trade and property source normally has its own update obligation.
What should you know about jointly let property?
For jointly let property, HMRC allows the quarterly update to include the person's property income and expenses or income only. If expenses are omitted, they must be reported after year end by resending the fourth update before the tax return.
Which official sources support this guide?
- https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/send-quarterly-updates
- https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/create-digital-records
- https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/before-you-use-this-guide
General guidance, not advice for your situation.
