The short answer
The short version: your tax return has not gone away, the 31 January deadline has not moved, and the biggest change is that the return is now the last step in a five step year rather than the only step. Under Making Tax Digital for Income Tax you send four quarterly updates from software, make your year end adjustments, then complete and file the return from that same software with a final declaration.
Everything else people worry about mostly is not true. You are not paying tax quarterly. You are not filing five tax returns. You are not sending HMRC your receipts. And the End of Period Statement that appears in a lot of older articles no longer exists, because HMRC removed it before the regime went live in April 2026.
Key takeaways
- The return survives. One Self Assessment return a year, due 31 January, exactly as before.
- Filed from software, not the HMRC website. The return is completed inside your MTD compatible product.
- One declaration, not two. The End of Period Statement was removed before launch. There is a single final declaration.
- HMRC pre-populates more than it used to, including PAYE income, pensions, CIS deductions, residential property Capital Gains Tax disposals and Marriage Allowance.
- You still add the rest yourself, including savings interest, dividends and any partnership profit share.
- Quarterly updates are not the figures. Adjustments happen after quarter four, and the return is what is final.
- Penalties moved to points, with no points issued for late quarterly updates in the 2026 to 2027 year only.
What has changed, side by side
How the return worked before
- Before: one annual filing
- Before: records in any format
- Before: filed on the HMRC website
- Before: you typed in everything
- Before: one submission and done
- Before: fixed late filing penalties
- Unchanged: the 31 January deadline
- Unchanged: payment dates
- Unchanged: what is taxable
How it works under MTD
- After: four quarterly updates plus the return
- After: digital records in compatible software, with digital links between products
- After: filed from your software
- After: HMRC pre-populates what it already holds
- After: a final declaration confirming the information is correct and complete
- After: a points-based late submission regime
- Unchanged: 31 January
- Unchanged: 31 January and 31 July, payments on account included
- Unchanged. MTD is a reporting change, not a tax change
That last row is worth its own sentence. Making Tax Digital does not change what you owe, what you can claim, or how profit is calculated. It changes how often you tell HMRC and where you tell it from. Anyone who reads it as a tax rise has read it wrongly, and anyone who reads it as merely administrative has underestimated how much administration it is.
Buhir has been teaching Making Tax Digital to local business owners since before the mandate landed. One attendee wrote afterwards: “Very informative and Buhir has a great knowledge of the UK taxation system.”
The sessions exist because the confusion here is not about tax, it is about sequence. Once someone can see the shape of the year, the individual steps stop being frightening.
★★★★★ Patricia O. in her own words, Google review, February 2026
A review of your first MTD year
Fifteen minutes, no charge. We will look at your update periods, your category structure and what your year end adjustments are likely to be, and tell you whether you need us or whether you are fine as you are. Book your free 15 minute review.
Or phone 029 2002 6505 and ask for Buhir.
What actually happens now: the five step year
- Keep digital records for each source of self-employment and property income, created close to the date of each transaction.
- Send four quarterly updates, on 7 August, 7 November, 7 February and 7 May, each one cumulative from 6 April.
- Make your adjustments after the fourth update: capital allowances, private use restrictions, stock, and everything else that turns bookkeeping totals into taxable profit.
- Add the income MTD does not cover, and check what HMRC has pre-populated.
- Make the final declaration and file, by 31 January.
Steps one and two are new. Steps three, four and five existed before under different names. The whole difference in your year, in practical terms, is that the bookkeeping now has deadlines attached to it instead of drifting until January.
What actually changes
The return stays. The route to it does not
Side by side, the parts of your filing year that move and the parts that stay exactly where they were.
Until now
- One Self Assessment return, once a year
- Filed on the HMRC website, or on paper
- Records written up whenever you got to them
- HMRC sees your figures once, in January
From your start date
- Four quarterly updates, then a final declaration
- Filed from MTD compatible software
- Records kept digitally as you go
- HMRC sees running totals four times a year
Unchanged: one tax bill a year, still due 31 January, still worked out on the same rules and the same allowances.
Want to see it on your own figures? Fifteen minutes is usually enough to show you exactly what your year looks like.
Walk me through my yearThe return itself: what HMRC fills in and what you add
The return is completed inside your software, which pulls in your quarterly figures automatically and then asks for everything else.
One return a year
Same return, same 31 January. A different place to complete it.
On the return
HMRC pre-populates
- Employment income through PAYE.
- Pension income.
- Construction Industry Scheme deductions, which is a meaningful improvement for subcontractors who used to reconstruct these from statements.
- Capital Gains Tax on residential property disposals already reported.
- Marriage Allowance claims.
You add
- Savings interest.
- Dividends, including dividends from your own limited company.
- Your share of partnership profit as an individual partner.
- Anything else outside MTD scope, which for many people includes foreign income, other capital gains and various reliefs and claims.
Pre-population is a help rather than a guarantee. HMRC’s figures come from what third parties have reported, and third parties get things wrong. Checking a pre-populated figure against your own P60 or CIS statements takes a minute and is worth doing every time. Where the Capital Gains position is more than a straightforward residential disposal, our capital gains tax service page sets out where that work usually sits.
The final declaration, and the statement that no longer exists
The final declaration is your confirmation that the information in the return is correct and complete to the best of your knowledge. It is the MTD equivalent of the declaration you used to tick at the end of the online return, and it carries the same weight.
The step that was cancelled before it ran
The point worth stating plainly is what it replaced. Earlier drafts of the regime, and a great deal of material still published today, describe an End of Period Statement submitted per business before the final declaration. HMRC removed that step. There is no EOPS. Where you are reading a guide that still describes one, that guide predates launch and its other details may be out of date too. Our own broad guide to Making Tax Digital covers the wider background, and this page carries the current filing position.
★★★★★
A caller who decided not to become a client at the time still wrote that Buhir “gave me a step by step guide to complete my Self Assessment and sent me tons of helpful info.”
That has not changed with the regime. Plenty of people who ring us want to understand the sequence and then do it themselves, and we would rather they filed correctly than filed with us. The offer on the first call is the same either way.
★★★★★ Ryan J. in his own words, Google review, January 2022
From our casework
The misconception we corrected most often over the summer was not about the quarterly updates. It was people assuming that because they had submitted four updates, their tax was somehow settled and the return was a formality.
It is not. Quarterly updates are unadjusted bookkeeping totals. Capital allowances, private use and stock all land afterwards, and the gap between the fourth update and the final figure can be substantial. Treat the updates as a running commentary and the return as the record.
Four updates, then one declaration
Get the adjustments right before the declaration is made
We keep the digital records, file the quarterly updates, make the year end adjustments and put the final declaration in front of you before anything is sent.
What stays exactly the same
This section exists because it is the one most readers actually need.
Untouched by Making Tax Digital
- The deadline. 31 January following the end of the tax year. For 2026 to 2027 that is 31 January 2028.
- Payment dates. 31 January and 31 July, payments on account included and calculated the same way.
- What is taxable. No rates changed, no allowances changed, no reliefs were withdrawn because of MTD.
- Allowable expenses. The rules on what you can claim are untouched. Our guide to self-employed allowable expenses still applies in full.
- Accounting basis. Cash basis or accruals remains your choice on the same terms.
- Records retention. Supporting documents such as invoices, receipts and bank statements still have to be kept, alongside the digital records rather than instead of them.
- Amending a return. The process for correcting a filed return is unchanged.
- Your accountant’s authority. An agent authorised for Self Assessment continues to act, filing through the Agent Services Account.
Where you file, and whether the HMRC website still works
For anyone inside MTD, the return is completed and filed from compatible software. The familiar HMRC online return is not the route any more, and that is the change most people notice first, because it removes a free option they had used for years.
Software has to do three things to qualify: create digital records, send quarterly updates and submit the tax return. Some products do all three. Others do part of the job and connect to another product by a digital link, which means a formula-linked spreadsheet, a CSV or XML transfer, an API connection or an automated transfer. Retyping a figure between two systems is not a digital link and never has been.
HMRC publishes the list of compatible products and it changes, so the sensible move is to check the current position rather than rely on what was true last year. Total Books works in Xero with Dext for receipt capture and files through the HMRC Agent Services Account, and where a client already has software they like we work in it rather than forcing a migration. More on the platform side sits on our Xero cloud accounting page.
Worked example one: the same trader, before and after
| Trade | Self-employed electrician, Newport. Turnover £58,000. |
| Before: submissions per year | 1 |
| Before: where filed | HMRC online return |
| Before: records | Spreadsheet, written up in December |
| Before: first time profit was known | January, three weeks before payment |
| After: submissions per year | 5, being four updates plus the return |
| After: where filed | Compatible software, filed by his agent |
| After: records | Bank feed and receipt capture, reviewed monthly |
| After: first time profit was known | August, and refreshed every quarter |
| Tax bill | Identical. The regime changed the reporting, not the liability. |
The genuine gain here is the last two rows read together. Knowing your profit position in August rather than January is the difference between planning a tax bill and absorbing one, and it is the one part of this regime that most of our clients have ended up valuing.
The penalty changes, and the year one easement
Late submission is now points based. One point per missed deadline. At four points, a £200 penalty, and a further £200 for each subsequent miss while you remain at the threshold. Below the threshold, individual points expire 24 months after the deadline they relate to. At or above it, points clear only after 12 months of filing everything on time together with catching up anything outstanding from the previous 24 months.
HMRC is issuing no points for late quarterly updates in the 2026 to 2027 tax year. The boundary matters: the easement covers quarterly updates and nothing else. A late tax return earns a point now, and late payment carries charges now.
Late payment in 2026 to 2027 runs at nothing within 15 days, then 3% of the outstanding tax once you pass 15 days, another 3% once you pass 30 days, and 10% a year accruing daily from day 31. The percentages step up in 2027 to 2028. Our guide to HMRC interest and penalty changes sets out the wider reform, including how it interacts with time to pay arrangements.
Points replaced fixed late filing penalties. The easement covers quarterly updates and nothing else.
What a full MTD year looks like
| April | Tax year opens. Confirm your update periods before the first submission. Records start from day one. |
| May to June | Bookkeeping kept current. Categories checked while the transactions are still recognisable. |
| By 7 August | Quarter one update filed, covering 6 April to 5 July. |
| By 7 November | Quarter two update filed, cumulative to 5 October. |
| By 7 February | Quarter three update filed, cumulative to 5 January. Payment on account due 31 January. |
| By 7 May | Quarter four update filed, covering the full year. |
| May to December | Year end adjustments, other income gathered, return prepared. |
| By 31 January | Final declaration made and return filed. Balancing payment and first payment on account due. |
Set against the old rhythm of doing nothing until December, that calendar looks heavy. In practice the load is smaller because it is spread, and because a category error found in June costs ten minutes while the same error found in January costs an afternoon. The clients who have adapted best are the ones who moved their bookkeeping to monthly and stopped thinking about the quarters at all.
Worked example two: what one return is actually made of
What goes into the return
What is filed, and when
Five of those nine rows existed under the old regime in exactly the same form. The genuinely new parts are the first row, where the figures arrive from work already done, and the last declaration, which replaced a two-step process that was cancelled before it ever ran.
A Bristol client who asked us to go back through three years of returns with him described the session this way: “Went through my tax returns as promised explaining everything as he was doing it and correcting my mistakes as he went along”.
Software does not do that part. It records what you tell it, accurately and quickly, and it has no opinion about whether the category was right. That judgement is still the job, and it is the reason a compliance regime built on software has not reduced the value of a human reading the numbers.
★★★★★ Keef B. in his own words, Google review, June 2022
What to do if this is your first MTD year
- Confirm you are actually in scope. Qualifying income is gross self-employment and property income, measured from your last submitted return.
- Sign up. It is not automatic. You or your agent has to do it, and an agent can do it through the Agent Services Account.
- Choose your update periods deliberately, standard or calendar, per source, before the first update of the year.
- Build the category structure once, properly. This is the decision that determines how much work the rest of the year is.
- Check the digital links. Anywhere data moves between two products, make sure it moves by a link rather than by retyping.
- Diarise all five dates, four updates and the return, and treat quiet quarters as filing quarters.
Anyone who would rather hand the whole thing over can do that too. Total Books runs the full MTD ITSA cycle for sole traders, landlords and self-employed professionals, and readers whose concern is the personal return rather than the regime will find more on our personal tax service page.
Working with you wherever you are. First MTD year support from our offices in Cardiff, Newport and Bristol, and UK wide through the Virtual Finance Office.
Frequently asked questions
Do I still submit a Self Assessment tax return under MTD?
Yes. One return a year, due 31 January, exactly as before. What changes is that it is completed inside compatible software rather than on the HMRC website, and that four quarterly updates have already fed it.
Is the End of Period Statement still required?
No. HMRC removed the End of Period Statement before the regime went live. There is a single final declaration confirming the information is correct and complete. A great deal of published material still describes an EOPS, and that material predates launch.
Has the 31 January deadline changed?
No. The filing deadline is unchanged, and so are the payment dates of 31 January and 31 July including payments on account. For the 2026 to 2027 tax year the return is due by 31 January 2028.
Can I still file on the HMRC website?
Not where you are inside MTD. The return is filed from compatible software. This is the change most people notice first, because it removes an option that was free and familiar.
Will my tax bill change because of MTD?
Not because of MTD itself. Rates, allowances, reliefs and the rules on allowable expenses are untouched. It is a reporting change. What often does change is the accuracy of the figures, because records kept quarterly tend to be more complete than records reconstructed in January.
What if I have not filed for several years?
Deal with it rather than wait. Quarterly data makes historic gaps more visible, not less. We have worked clients back into compliance from several years of arrears, including a self-employed client who resolved seven years of tax issues and avoided bankruptcy. That is a past result for that client rather than a promise, and the case study is published in full.
Do the quarterly updates become my final figures?
No. They are unadjusted bookkeeping totals. Capital allowances, private use restrictions, stock and other adjustments are made after the fourth update, and the return is what is final. Treating an update as a settled position is the most common misreading we correct.
What happens if I file the return late?
The first-year easement covers quarterly updates only, so a late return earns a penalty point immediately. Four points produce a £200 penalty. Late payment is charged separately at 3% once you pass 15 days, a further 3% once you pass 30 days, and 10% a year accruing daily from day 31 in the 2026 to 2027 year.
Related guides
Three reads that pick up where this one stops: whether you are in at all, what the four updates contain, and how the return itself is put together.
Scope
The £50,000, £30,000 and £20,000 tests, what counts as qualifying income and what is left out of it.
MTD ITSA income threshold explainedEvery quarter
What actually goes into the four updates, when each one is due and why a nil quarter still gets filed.
Quarterly updates for sole traders and landlordsThe return
Preparation, records and the questions worth answering before the return is started at all.
Preparing your Self Assessment returnHand over the whole cycle
Let someone else run the five step year
Total Books handles digital records, all four quarterly updates, the year end adjustments and the final declaration for sole traders, landlords and self-employed professionals. Offices in Cardiff, Newport and Bristol, and UK wide through the Virtual Finance Office.
This guide is general information about UK tax rules current at 10 August 2026 and is not advice for your circumstances. Deadlines, penalty easements and HMRC guidance on Making Tax Digital can change. Any client outcome described is a past result for that client and not a promise of a similar result. Total Books Accountants Ltd is an AAT licensed practice and an HMRC registered tax agent. Please take advice before acting.
