If 7 August 2026 came and went without your first Making Tax Digital quarterly update, you are in the same position as a large share of UK landlords and sole traders. Data cited by ACCA, drawing on HMRC figures, shows that only around 400,000 of the roughly 850,000 taxpayers in scope had registered by the deadline, meaning more than half had not. HMRC’s built in soft landing means there is no immediate penalty for this, but there is still work to do, and the accounting side of this matters as much as the software side.
This guide explains what actually happened on 7 August, what the soft landing does and does not cover, how to correct a missed submission, and the accounting steps that protect you from a bigger problem in January 2028.
What Was the 7 August Deadline?
The 7 August 2026 deadline was the first quarterly filing point under Making Tax Digital for Income Tax. Landlords and sole traders whose combined gross income from property and self employment exceeded £50,000 on their 2024/25 Self Assessment return were required to have registered, kept digital records from 6 April 2026, and submitted a quarterly update covering 6 April to 5 July 2026. The legal basis sits in the Finance (No. 2) Act 2017 and the Income Tax (Digital Requirements) Regulations 2026, which require MTD taxpayers to keep digital records and use compatible software to send HMRC a quarterly summary of income and expenses.
Roughly 864,000 taxpayers fell into this first wave, yet ACCA figures suggest the majority were not ready in time. Given that MTD requires more than a simple sign up, involving software connection, digital bookkeeping habits and category based reporting, this level of non compliance reflects a genuinely difficult transition rather than isolated carelessness.
The Soft Landing: What It Covers and What It Does Not
HMRC confirmed a 12 month soft landing for 2026/27 that removes late submission penalty points for quarterly updates during the first year of MTD for Income Tax. This is genuinely useful protection, but it is narrow, and treating it as a general pass creates risk.
The soft landing does not remove your obligation to register for MTD, keep digital records from 6 April 2026, submit all four quarterly updates, pay your tax on time, or provide accurate information to HMRC. Late payment penalties and interest on unpaid tax continue to apply under the normal rules regardless of the soft landing. ACCA has specifically warned against treating this concession as a free pass, since it applies only to late submission penalty points and nothing else.
| You get a pass on | You do not get a pass on |
|---|---|
| Late submission penalty points for quarterly updates in 2026/27 | Registering for MTD |
| Keeping digital records from 6 April 2026 | |
| Submitting all four quarterly updates | |
| Paying your tax on time | |
| Providing accurate information to HMRC |
What Happens If You Skip an Update Entirely
Skipping a quarterly update does not make the obligation disappear. All four quarterly updates for the tax year must be submitted before you can file your Final Declaration, the new name for the annual Self Assessment return, which is due by 31 January 2028 for the 2026/27 tax year. Leaving Q1 unsubmitted means it stacks up alongside Q2, Q3 and Q4, and a rushed January submission of four updates feeds directly into a Final Declaration that carries its own separate penalty regime, including an immediate £100 charge for late filing and daily penalties after three months.
From an accounting perspective, this is the real risk hidden inside the soft landing headline. The concession removes one specific penalty type while leaving the underlying compliance chain, and its consequences, fully intact.
Can You File a Nil or Estimated Update and Fix It Later?
HMRC’s own guidance confirms you must still submit a quarterly update even where no income was received or expenses incurred in the period, and that quarterly updates are summaries rather than full tax returns, so accounting or tax adjustments are not required before sending them. HMRC also allows digital records to be corrected after a quarterly update has already been submitted.
That flexibility has a limit. HMRC’s guidance is explicit that it remains your responsibility to check that digital records are accurate before sending a quarterly update, and this is not licence to submit placeholder or invented figures purely to appear compliant. A landlord who omits a repair invoice because it had not yet arrived can correct that later, but deliberately inaccurate figures created just to meet the deadline are a different matter and carry their own risk if HMRC later reviews the return.
What Happens After the Soft Landing Ends
The concession is time limited. From the 2027/28 tax year, every missed quarterly deadline earns one penalty point, and once four points accumulate, HMRC issues a fixed £200 penalty, with a further £200 for each additional late submission while you remain at that threshold. Points expire only after a sustained run of on time filing, so the earlier good habits are built, the sooner that clock can start working in your favour.
The next deadline after 7 August is 7 November 2026 for the quarter covering 6 July to 5 October, followed by 7 February 2027 and 7 May 2027, with the Final Declaration due 31 January 2028. Submitting the overdue Q1 update well before 7 November avoids entering the second quarter carrying two outstanding obligations at once.
Are Any Landlords Exempt from the First Wave?
Non resident landlords who filed the residence pages, form SA109, with their 2024/25 Self Assessment return have been automatically deferred from MTD for Income Tax until the 2027/28 tax year. Separately, taxpayers who did not have a National Insurance number before the start of the tax year cannot sign up for MTD for that year and are exempt for that period. Neither rule means every non resident landlord is automatically excluded, since residence status, UK and overseas property holdings and National Insurance history all need to be reviewed together before assuming a deferral applies.
What to Do This Week
- Submit the missed update as soon as possible through MTD compatible software; there is no separate late submission process, it files exactly as an on time update would
- Confirm you are actually registered for MTD and that your software is authorised to communicate with HMRC through Government Gateway
- Bring your digital records for 6 April to 5 July fully up to date before submitting, since category totals built from incomplete records are where errors creep in
- Diarise 7 November 2026 now as the next quarterly deadline and treat the current scramble as a reason to build a steadier routine
- Have your figures reviewed before submission if this is your first time using MTD software, since a quick check now is cheaper than correcting errors at the Final Declaration stage
How UK Property Tax Accountants Can Help
Missing a Making Tax Digital deadline is recoverable, but getting the correction right, and staying ahead of the next three quarterly deadlines, is where an experienced property tax team adds real value. Our property accountants handle the full MTD process for landlords and sole traders so a missed update does not turn into a pattern of missed years.
- Reviewing whether you are correctly in scope for MTD for 2026/27, including checking non resident landlord and National Insurance based exemptions
- Registering you for MTD for Income Tax and connecting your chosen software to HMRC through Government Gateway
- Preparing and filing your overdue quarterly update using your actual digital records, not estimated placeholder figures
- Correcting any errors or omissions identified in earlier quarters before they carry through to your Final Declaration
- Setting up ongoing digital bookkeeping so future quarterly deadlines, including 7 November 2026, are met without a last minute rush
- Monitoring your penalty point position ahead of the 2027/28 tax year, when the soft landing ends and points begin accumulating
- Managing your full MTD compliance from as little as £30 per month, so you are not left tracking four separate deadlines alone
Frequently Asked Questions
Will I be fined for missing the 7 August 2026 MTD deadline?
No. HMRC’s soft landing removes late submission penalty points for quarterly updates during 2026/27, but the update must still be submitted.
Does the soft landing cover late payment of tax?
No. It only removes penalty points for late quarterly updates. Late payment penalties, interest and Final Declaration filing penalties continue under the existing rules.
Can I just skip a quarterly update since there is no fine?
No. All four quarterly updates must be submitted before you can file your Final Declaration, and skipping one simply leaves it outstanding alongside later quarters.
What happens once the soft landing ends?
From 2027/28, each missed quarterly deadline earns one penalty point, and four points trigger a fixed £200 penalty, with further £200 charges for continued late filing.
I have not signed up for MTD at all, is it too late?
No. You can still register via GOV.UK or through an agent, and you will need HMRC recognised software connected via Government Gateway before submitting outstanding updates.
