The August 2026 MTD Deadline is Here: What Sole Traders and Landlords Must Do Now

Author: Phillips & Co Accountants, Chester

Date: 22 June , 2026

We are officially in the Making Tax Digital (MTD) era for Income Tax. If you are a sole trader or landlord with a gross annual income over £50,000, the new rules legally took effect on 6 April 2026.

However, many business owners remain unaware that under the new system, your tax responsibilities no longer wait until January. As the proactive accountants Chester businesses rely on, Phillips & Co is currently warning local clients that the absolute deadline for your very first quarterly MTD submission is fast approaching: 7 August 2026.

If you are still relying on desktop spreadsheets or carrier bags of receipts, here is exactly what you need to know to avoid HMRC penalties this summer.

What exactly is due in August 2026?

Under MTD for ITSA, the annual Self-Assessment tax return is being replaced by quarterly digital updates.

For the current tax year, your first quarter covers the period from 6 April 2026 to 5 July 2026. You then have until the 7th of the following month to submit a digital summary of your business income and expenses to HMRC using approved cloud software. This means the hard deadline for Quarter 1 is 7 August 2026.

This is not a full tax calculation, and no physical tax payment is due in August, but the raw data must be digitally bridged to HMRC. Manual typing is no longer permitted.

What if my income is under £50,000?

If your combined business and property income sits between £30,000 and £50,000, you are currently in a grace period—but not for long. Phase 2 of MTD for ITSA becomes mandatory on 6 April 2027.

Smart business owners are making the switch to digital software now. Delaying until 2027 guarantees a stressful transition when the HMRC bottleneck inevitably occurs next spring.

How to survive your first MTD submission

Filing quarterly requires a permanent shift in how you run your business admin. To ensure a frictionless submission this August, you must do three things immediately:

• Use Approved Cloud Software: You must use HMRC-recognised software like Xero, QuickBooks, or FreeAgent.

• Digitise Your Expenses: Stop hoarding paper. Use receipt-scanning apps (like Dext) to digitally capture invoices on the go.

• Reconcile Weekly: You can no longer leave your bookkeeping until year-end. Your bank feeds must be reconciled regularly to meet the strict quarterly deadlines.

Need help? Contact Phillips & Co Accountants

If the thought of quarterly HMRC submissions fills you with dread, you do not have to tackle it alone. Based in Chester, we provide fixed-fee bookkeeping and tax packages that take the MTD burden entirely off your shoulders.

Disclaimer: The information contained in this article is for general guidance only and does not constitute bespoke tax or financial advice. Tax rules (and HMRC’s interpretation of them) are subject to change. Always consult with a qualified accountant regarding your specific circumstances before taking action.