MTD ITSA 7 November 2026 Deadline: Second Quarterly Update Checklist
HMRC sends the letter when it has not received updates for every self-employment and property business. If they file for the trade but miss the property income source, the client still counts as late.
The second quarterly update, due 7 November 2026, either closes those gaps or carries them forward. Each update is cumulative from the start of the tax year, which makes Q2 your best chance to correct Q1 across the client list.
What the Q2 Update Covers
Under Making Tax Digital for Income Tax, standard update periods run from 6 April to 5 October 2026 and calendar update periods run from 1 April to 30 September 2026. Both share the 7 November deadline. The period type is chosen before the first update and stays fixed for the rest of the tax year, so any Q1 mismatch carries straight into Q2.
Corrections to Q1 records flow into the Q2 year-to-date totals without a separate re-submission. Whether a client files through full accounting software or bridging software for MTD, the tool only sends the figures it is given. Finding the errors remains your firm’s job.
Where Q2 Goes Wrong
Sent Is Not the Same as Fulfilled
HMRC sets a separate obligation for each income source, not each client. Take a sole trader who also lets a flat: HMRC expects two updates every quarter. Where making tax digital software combines both into one submission, or links it to the wrong source, HMRC accepts the update and the second obligation stays open.
Sources added in error or set up twice cause the same problem, as does one spreadsheet holding two businesses filed through HMRC bridging software. Software marking an update as sent is not proof. Only a fulfilled obligation on HMRC’s records closes the quarter.
Q1 Errors Sit Inside the Year-to-Date Figures
Any miscategorised cost, missed refund or double-counted transfer from April to June stays in the cumulative total until someone corrects the underlying record. Where Q2 totals jump or fall sharply against Q1, check cut-off, missing statements and postings to the wrong business before accepting it as genuine trading.
The Penalty Easement Has Limits
HMRC will not issue penalty points for late quarterly updates during 2026/27, the first year of Making Tax Digital for Income Tax. Clients often hear that as permission to skip a quarter. Penalty points still apply to a late 2026/27 tax return, and the return cannot be filed until every quarterly update is in. No easement has been announced for clients joining in 2027/28.
Q2 Lands in a Crowded Diary
Your team is also signing up clients with qualifying income above £30,000 for 2027/28 and preparing 2025/26 returns for 31 January 2027. On Saturday 7 November, the Agent Dedicated Line closes, and unresolved queries may roll into a callback the following week.
MTD Q2 Checklist for Your Firm
- Map each income source. Match every source on the client’s HMRC record to a business in your software. Domestic lets form one property business, and overseas property is reported separately.
- Confirm the update period. Check the software setting matches the period type used for Q1.
- Triage Q1. Group clients into fulfilled, sent but still open, and not sent. Send any outstanding Q1 update now and use HMRC letters to pinpoint the open source.
- Review self-set-up clients. If a client chose the best free tax-making software on their own, confirm which sources it is linked to before taking over.
- Reconcile year-to-date. Cover refunds, cash takings and transfers between the client’s own accounts from April onwards.
- Confirm the accounting basis. Cash basis is the default for sole traders and for landlords with rental receipts of £150,000 or less. Clients on accruals need invoices and bills cut off at the period end.
- Test category mapping. Check that ledger codes added since Q1 reach the right HMRC category.
- Check agent roles. Supporting agents can send quarterly updates but cannot see every income source or file the return.
- Submit by 4 November. Leave time for validation errors and HMRC contact during the working week.
- Confirm fulfilment. Close each source only when HMRC shows the obligation as fulfilled, and keep the acknowledgement on file.
Q2 Mistakes to Avoid
- Sending the latest quarter only. Q2 is cumulative, so a single-quarter figure understates the year.
- Combining two businesses in one update. Each trade and each property business needs its own submission.
- Linking the wrong spreadsheet range. HMRC bridging software sends whatever totals it reads, so a formula still pointing at one quarter sends a short update.
- Carrying Q1 estimates forward. Replace them with actual figures and record who owns each open item.
- Sending a live update as a test. Use preview and validation checks instead. Every live submission reaches HMRC.
- Treating the easement as an exemption. Late updates still hold up the final return.
Final Thoughts
Q2 shows whether your MTD process holds up across a full client list. Firms that reconcile source by source now will reach Q3, due 7 February 2027, with clean cumulative figures and a quieter final return season.
Are you ready to make your Q2 updates seamless across your entire client list?
Let Acxite enable your firm to automate MTD compliance, catch open obligations before deadlines hit, and file with confidence directly to HMRC.