MTD Calendar Quarters Election: Should You Use It?

A calendar quarters election lets you send your Making Tax Digital for Income Tax updates for periods that end on the last day of a month, rather than on the 5th. It is worth using if your books, bank statements or VAT quarters already run to month ends, and it does not change your filing deadlines. You choose it in your software, and you have to do so before the first quarterly update of the tax year goes in. This guide explains how the two options differ and how to decide.

Key takeaways

• Standard update periods end on 5 July, 5 October, 5 January and 5 April. Calendar periods end on 30 June, 30 September, 31 December and 31 March.
• The deadlines are the same either way: 7 August, 7 November, 7 February and 7 May.
• The election is made in your MTD software before the first update of the tax year is sent. It cannot be changed for that year afterwards.
• It suits people whose records naturally close at month end, especially VAT-registered businesses.

What is the calendar quarters election?

Under Making Tax Digital (MTD) for Income Tax, sole traders and landlords above the income threshold keep digital records and send HMRC a summary of income and expenses every three months. By default those summaries follow the tax year, which starts on 6 April, so each quarter ends on the 5th of a month. Very few businesses think in periods that end on the 5th. Bank statements, supplier statements, payroll and VAT returns nearly all work to the end of a month.

The calendar quarters election, which HMRC calls using "calendar update periods", fixes that mismatch. Your updates run to the month end instead. HMRC describes both options in its guidance on how to send quarterly updates, and says that if your accounting period covers 1 April to 31 March you should consider using calendar periods because it will make record keeping simpler.

Who does MTD for Income Tax apply to?

MTD for Income Tax applies from 6 April 2026 if your qualifying income from self-employment and property was over £50,000 in 2024/25. It applies from 6 April 2027 if that income was over £30,000 in 2025/26, and from 6 April 2028 if it was over £20,000 in 2026/27. If you are not sure whether you are caught, our guide to MTD qualifying income explains what counts.

Standard periods and calendar quarters compared

One detail is worth knowing. HMRC's guidance explains that each update is cumulative: it covers from the start of the year to the end of the latest period, not just the last three months. Your software works this out for you. The practical benefit is that if you find a missed receipt from an earlier quarter, you correct your records and the next update picks it up, without resending the earlier one. That is true whichever type of period you use.

What the election does not change

• Your deadlines. They stay at 7 August, 7 November, 7 February and 7 May. See our guide to MTD quarterly update deadlines.
• The number of updates. You still send four a year for each self-employment and each property business.
• How much tax you pay or when you pay it. The election is about reporting dates only.
• The need for digital records. You still have to keep them in compatible software. Our guide to MTD digital records covers what that means.

Who should use it, and who should not bother

The election is usually helpful if:

• You are VAT registered and your VAT quarters end on the same month ends, so one set of figures can feed both submissions.
• You draw up your accounts to 31 March each year.
• You reconcile to monthly bank statements, or you receive monthly statements from a platform, letting agent or supplier.
• You would like a little more breathing space. A period ending on 30 June leaves about five more days before 7 August than one ending on 5 July.

You may prefer to stay on standard periods if:

• Your accounts run to 5 April and you already keep tidy records on that basis. HMRC says standard periods are the ones to use where your accounting period matches the tax year.
• Your income arrives weekly and you track it by tax year anyway, as many drivers and couriers do.

Step by step: making the election

1. Check when your accounts and VAT quarters end. If everything closes at month end, the election is likely to save you work.
2. Confirm your software supports calendar update periods. HMRC keeps a list of software compatible with MTD for Income Tax. Ask the provider if the option is not obvious in the settings.
3. Select calendar periods for each income source. HMRC says the selection is made for each source of income, so if you have a trade and a rental property, set both.
4. Do it before your first quarterly update of the tax year. Once an update has been sent, the periods for that year are fixed.
5. Put the four deadlines in your calendar. They do not move, so set reminders for a week or two before each.

HMRC's overview of how to use Making Tax Digital for Income Tax sets out the wider process, from signing up to the final declaration.

Timing in October 2026

If you joined MTD on 6 April 2026, your first update for 2026/27 was due by 7 August 2026. If you sent it on standard periods, those periods are fixed for the rest of this tax year. You can still choose calendar quarters for 2027/28, as long as you select them before sending the first update of that year, which is due by 7 August 2027.

If you join MTD on 6 April 2027, you have a clean choice. Decide over the winter, set it up when you configure your software, and use our first quarterly update checklist before you file.

Worked example (illustrative)

"Dara", an illustrative example, is a self-employed electrician. His self-employment income in 2025/26 was over £30,000, so he comes into MTD for Income Tax from 6 April 2027. He is VAT registered and his VAT quarters end on 30 June, 30 September, 31 December and 31 March. He prepares accounts to 31 March.

On standard periods, Dara would close his books on 30 June for VAT, then again on 5 July for MTD. Any invoice raised or materials bought on 1 to 5 July would sit in one submission but not the other, and the two sets of figures would never agree without a reconciliation.

Dara selects calendar update periods in his software in April 2027, before his first update. His first MTD period now runs from 1 April to 30 June 2027, the same cut-off as his VAT quarter. He reconciles the bank once to 30 June, checks the totals, and sends the update well before 7 August 2027. He repeats the same routine at 30 September, 31 December and 31 March.

Dara and his circumstances are invented for illustration and are not a real client.

Common mistakes

• Assuming the election moves the deadlines. It does not. A period ending 30 June is still due by 7 August.
• Leaving the decision until after the first update. By then the periods for that tax year are locked.
• Setting it for one income source and forgetting the other. Check every self-employment and property business in your software.
• Choosing calendar quarters when your VAT quarters do not match. If your VAT stagger ends in different months, the benefit is smaller. Look at the dates side by side first.

How we can help

We set up MTD software for sole traders and landlords, choose the update periods that fit your records, and prepare and send your quarterly updates and final declaration. Our MTD compliance service starts from £49 per month on a fixed fee. View our pricing, or contact us to decide which update periods suit you before your next tax year starts.