Reporting requirements

Quarterly updates

MTD requires quarterly reporting to HMRC of income and expenditure, including the data that comprises these items.

Reporting deadlines for MTD for VAT align to the VAT quarters, with a filing deadline of one month and seven days from the end of the VAT quarter.

Reporting deadlines for MTD for income tax are as follows:

HMRC’s plan is to also introduce standard calendar quarter reporting as an alternative, although it is currently not available as an option.

	Period covered	Filing deadline
Quarterly update 1	6 April to 5 July	5 August
Quarterly update 2	6 July to 5 October	5 November
Quarterly update 3	6 October to 5 January	5 February
Quarterly update 4	6 January to 5 April	5 May

Quarterly update 1	1 April to 30 June	5 August
Quarterly update 2	1 July to 30 September	5 November
Quarterly update 3	1 October to 31 December	5 February
Quarterly update 4	1 January to 31 March	5 May

Annual updates for income tax returns

MTD quarterly income tax returns are not equivalent to traditional income tax returns, therefore an end of year return will also need to be submitted which reconciles the quarterly submissions to the annual taxable figures. The annual update will also include any income and tax reliefs not reportable under MTD.

Therefore, under MTD, instead of one annual submission, there will be five submissions.

Software

MTD reporting must be done using software that is MTD compliant.

There are various options in this respect, ranging from spreadsheet-based systems to comprehensive management accounting packages.

Various of these software packages are cloud based too.