Avoid Penalties Under Making Tax Digital

The best way to avoid problems under Making Tax Digital is to get organised early. Even though HMRC is not applying penalty points for late quarterly updates in the 2026 to 2027 tax year, you still need to keep proper digital records and send your updates before you can complete your end-of-year tax return.

If you leave everything until the last minute, the risk usually comes from poor records, missed deadlines later in the process, and late payment of tax rather than from the first quarterly update itself.

• Keep digital records from the start
• Do not rely on paper records alone
• Know your quarterly update dates
• Do not ignore payment deadlines

Read HMRC’s penalties guidance

What matters most in 2026

For taxpayers required to join Making Tax Digital from 6 April 2026, HMRC says it will not apply penalty points for missing quarterly update deadlines during the first tax year. However, you still need to send those updates, and late payment penalties can still apply if your tax is not paid on time.

HMRC’s published quarterly deadlines are:

• 7 August
• 7 November
• 7 February
• 7 May

Income tax payment dates themselves do not change just because you move onto Making Tax Digital. In general, the usual payment dates still apply.

Common mistakes to avoid

• Assuming “no penalty points” means quarterly updates do not matter
• Waiting for HMRC to chase you before getting ready
• Using a record-keeping method that is not properly digital
• Leaving tax payment planning too late
• Not checking whether your software or spreadsheet setup is fit for purpose

If you think MTD applies to you, your safest next move is to get your record-keeping method ready, note the dates, and make sure you are not caught out later by payment or filing issues.

What you need to do next

This page is a general guide and should not be treated as personal tax advice.