Making Tax Digital · Sole traders
A mid-period review of your second-quarter MTD records
ONLY£15A MONTHA review during the second reporting period can reveal missing sources and repeated category errors before the filing deadline.
A review during the second reporting period can reveal missing sources and repeated category errors before the filing deadline. The aim is to check whether the routine is working, then correct the specific problem. A connected feed and a quiet inbox are not sufficient evidence that the records are complete.
Check the actual point in the period
For standard reporting, the second three-month segment runs from 6 July to 5 October 2026. By the end of August, much of that segment has already passed; it is not the start of Quarter Two. The second cumulative update covers 6 April to 5 October and is due by 7 November.
Calendar-period users should use their own cut-off. Check the software setting and the year-to-date totals before comparing progress with a general calendar reminder.
Review the routine, not just the balance
Check bank and provider coverage, cash receipts, agent statements and new accounts. Inspect rules against recent transactions and confirm that private spending or refunds have not been repeatedly misclassified.
Look back at first-quarter corrections. Confirm they are reflected in the current cumulative records and that any outstanding reporting has a clear next action. Keep annual tax questions visible without allowing them to conceal unresolved bookkeeping errors.
Worked example: a new payment provider
A business adds a payment provider in August but continues reviewing only its original bank and card account. The mid-period source check identifies the new provider before several months of fees and refunds accumulate.
The business adds the records, reconciles gross receipts to payouts and updates its recurring checklist. The benefit comes from correcting the source list, not merely refreshing the same bank dashboard.
A review that checks more than the total
Start with coverage: the correct person, business and period, plus all relevant accounts and cash records. Then look at completeness. A feed can be connected today while still missing an earlier week. Confirm the earliest and latest transactions against the source.
Next, inspect unusual items. Large transfers, loan receipts, refunds, net settlements and private purchases often need more context than a bank description provides. Check for duplicate imports where a statement overlaps a live feed. An automatic warning is useful evidence to investigate, not proof that the entry must be removed.
Finally, review category totals. A category unexpectedly showing zero, a large increase or a negative amount deserves an explanation. You do not have to make every annual tax adjustment at this stage, but you should understand the records behind the summary you approve.
HMRC explains what quarterly updates contain. Keep the approved version and the resulting acknowledgement together. If something later changes, correct the source record and use the software's supported update process so you can explain which figures are current.
Keep the reporting dates separate from payment dates
The standard first update for 2026/27 covers 6 April to 5 July 2026 and was due by 7 August 2026. The second covers 6 April to 5 October 2026 and is due by 7 November 2026. The third and fourth deadlines are 7 February 2027 and 7 May 2027. These are cumulative updates, not four isolated sets of three-month totals.
Calendar periods have different cut-offs and the same filing deadlines. Check the setting for each business rather than assuming the dates from a bank statement. HMRC lists both reporting calendars.
The annual return for 2026/27 is due by 31 January 2028. The earlier 2025/26 return normally remains due online by 31 January 2027. Keeping those years distinct avoids a common transition-year misunderstanding.
Payments on account, where required, follow their own January and July timetable. An update acknowledgement confirms a reporting event; it does not confirm that an outstanding tax bill has been paid. Check your actual HMRC account and payment obligations separately from the software's progress indicators.
Keep the evidence connected to the figures
Your digital record should explain the amount, date and nature of the transaction. Keep the invoice, receipt, statement or other evidence that supports it. A photograph can make a paper document easier to retain, but a folder of photographs alone does not create complete transaction records.
For sole traders, HMRC normally requires business records to be kept for at least five years after the relevant 31 January filing deadline. Keep them longer where the rules for a late return, enquiry or other circumstances require it. Check the record-retention guidance.
Make the records usable by your future self. Include a short explanation where a bank description is vague, retain the calculation behind a business-use split and make corrections traceable. For a missing receipt, try the supplier account, email confirmation or a replacement invoice before relying on incomplete evidence.
At review time, compare your records with the bank or payment account and investigate differences. Equal totals are useful, but two errors can cancel each other out. A sample of individual transactions can reveal a duplicated purchase or an omitted customer receipt that a totals-only check misses.
Finish with three practical actions
Resolve the oldest missing source, review any unreliable category rule and schedule the next check before quarter end. Confirm who will approve and submit the second update. A specific maintenance routine makes November's filing work more predictable.
Take the next step
Avona.app offers a self-service route from £15/month. Bring your records together, review the figures and choose a workflow that fits your business. For professional help, discuss the scope and total price of Avona Concierge, managed by chartered accountants, before choosing a service.