Making Tax Digital · Sole traders
Missing the 7 August 2026 MTD deadline: what to do next
ONLY£15A MONTHIf you missed the first 2026/27 quarterly-update deadline, start by checking what is outstanding and completing the supported catch-up process.
If you missed the first 2026/27 quarterly-update deadline, start by checking what is outstanding and completing the supported catch-up process. HMRC's first-year concession means no penalties for missing quarterly-update deadlines in that tax year. The obligation to keep digital records and report still remains.
Identify the unfinished part
Check whether the problem is registration, missing records, software access, review or an unsuccessful submission. If an attempt was made, establish its outcome before sending again. A technical reference or saved draft is not necessarily an accepted update.
Build a source list and recover missing history. Reconcile the relevant period, correct identified errors and use the software's supported route for outstanding reporting. Continue maintaining the current period so catch-up does not create another backlog.
Keep tax years separate
The first mandatory 2026/27 MTD annual return is normally due by 31 January 2028. The 2025/26 return due online by 31 January 2027 is a separate obligation. A missed August 2026 quarterly update should not be described as automatically blocking that earlier year's return.
Payments and interest also have their own rules. The quarterly concession does not cancel a tax bill or excuse every other late filing. Use HMRC's penalty guidance for the precise scope.
Worked example: an update never sent
A landlord prepared the records before 7 August but did not complete the submission. After checking that there is no accepted outcome, the landlord reviews the current records and follows the supported catch-up process.
The landlord keeps the true submission date. Completing the missing update later is useful; pretending it was filed before the deadline would create an inaccurate history.
Understand the first-year concession
HMRC states that there are no penalties for missing quarterly-update deadlines for the 2026/27 tax year. That concession does not remove the digital-record or quarterly-reporting obligations, and it does not make all tax returns and payments penalty-free. Read the precise penalty guidance.
Outstanding quarterly reporting must be dealt with before completing the relevant annual return. However, a missed August 2026 update should not be described as an automatic penalty on the separate 2025/26 return due in January 2027. The 2026/27 annual-return deadline is January 2028.
After the first-year concession, the points rules apply to missed quarterly deadlines as described by HMRC. Do not assume that multiple businesses create multiple points at the same deadline. Annual-return rules, late-payment penalties and interest require their own checks.
If you have fallen behind, establish what is outstanding and work through the supported catch-up process. Keep evidence of technical problems and contact the appropriate support team with the business, period and error details. The useful next step is a complete record and an accepted update, rather than guessing what a generic warning might mean.
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 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.
Get help with the specific obstacle
Tell support or your adviser which business, year and period are affected and what you have already completed. Keep technical evidence and agreed next steps. Aim for complete records and confirmed reporting rather than waiting for a penalty notice to prompt action.
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.