#PaddyTimeMTD
A practical case for extending the MTD quarterly filing window to three months.
Making Tax Digital for income tax is here. The intention is sound — better record-keeping, more frequent data, a more modern tax system. But the deadlines as currently designed aren’t ready for the real world, and that puts the whole policy at risk. PaddyTimeMTD is the proposal to fix it: extend each quarterly filing window from five weeks to three months. A small change, but one with significant practical benefits for agents, taxpayers and HMRC.
Why "PaddyTime"?
The idea picked up its name within the Accountants Therapy Group, a community of practitioners who share frontline experience of workload and compliance pressures. The nickname is light hearted, but the point behind it is not. Real-world accounting work doesn’t happen in neat, structured cycles. It happens around deadlines, client behaviour, and the actual capacity of the people doing the work. PaddyTime is, simply, a deadline that reflects that reality.
The idea, in plain terms
Quarterly reporting stays exactly as it is. The structure of MTD remains intact.
The only thing that changes is the filing window, three months after each period ends, instead of five weeks.
That single adjustment unlocks several things at once. Agents can spread their workload evenly across the year. Clients get realistic timeframes to provide the records and clarifications that always take longer than anyone plans for. Submissions are based on complete, accurate information rather than incomplete data rushed under pressure. HMRC still receives the same quarterly cadence of data just better quality data, with far fewer amendments coming back later.
Speed isn't the same as accuracy
There is an important distinction between work that meets a deadline and work that’s right. Under MTD, where both agents and taxpayers are still adapting to a new way of working, that distinction matters more than ever.
Most firms will adopt compliant software, so the question isn’t whether the work can be done. The question is when it can be done properly. Bunched deadlines push people toward submitting on time at any cost. A longer window lets them submit on time and accurately, which is the whole point of MTD in the first place.
If the timing isn’t workable, accuracy will suffer. And once accuracy suffers, every other benefit MTD is meant to deliver suffers with it.
The February problem
Under the current rules, quarterly submissions are due by the 7th of the month following the end of each period. On paper, that supports the idea of real-time reporting. In practice, it creates pressure points across the year, and the worst of them is unavoidable.
The third-quarter MTD deadline lands in early February, days after the 31 January self assessment deadline. January is already the busiest and most stressful month in accounting. Firms are running at full capacity, and in many cases well beyond it, simply to meet existing obligations.
Stacking a brand-new filing requirement on top of that doesn’t support compliance — it puts it at risk. There is very little realistic capacity left at that point in the year to deal with additional reporting properly, no matter how compliant the underlying software is.
HMRC has done this before
This isn’t a hypothetical ask. HMRC has already extended a deadline that wasn’t working in practice — the capital gains tax reporting window on UK property disposals, which moved from 30 days to 60.
The reasoning was straightforward. The original timeframe didn’t reflect how property transactions actually work. The change reduced pressure on agents and taxpayers, improved compliance, and didn’t undermine the underlying policy in any way. It simply made it function better.
Applying the same thinking to MTD would demonstrate a willingness to make the new regime work in the real world, not just on paper.
Who benefits
- Taxpayers - get a realistic window to gather their records and respond to queries from their accountant, which means fewer mistakes on their return and less stress around each filing date.
- Agents - can plan workload sensibly across the year instead of running into impossible pressure points. The result is better service for clients, fewer amendments to fix, and more time spent on advice rather than firefighting.
- HMRC - receives better-quality data, fewer amendments, lower penalty volumes, and reduced strain on its own systems during the January-to-February peak. The exchequer doesn't lose anything; the data simply arrives in a more reliable form.
The bottom line
MTD is one of the most significant changes to the UK tax system in decades. To deliver what it was designed to do, it has to fit into the day-to-day realities of the profession that operates it. A three-month filing window is a small, sensible adjustment with disproportionate benefits, for agents, for taxpayers, and for HMRC itself.
Get the foundations right early, and MTD has a far better chance of succeeding. That, in the end, is what PaddyTimeMTD is really about.
A temporary fix, not a permanent change
PaddyTime doesn’t need to be permanent. Once MTD is properly embedded, once software, workflows and client behaviours have all settled into a sustainable pattern, the deadlines can absolutely be revisited. The case here isn’t that five weeks will never work. It’s that five weeks doesn’t work yet, and the cost of pretending otherwise will be paid in late filings, mistakes and disputes.
The priority for the early years of MTD has to be a system that works well and produces accurate submissions. Tightening the window can come later, once that foundation is in place.
Stay compliant with confidence
MTD for Income Tax is transforming how millions of individuals report their tax. With mandates starting in 2026 and 2027, preparation is essential.
Our practice has been at the forefront of this change, helping shape the journey through direct HMRC collaboration, speaking engagements, and real pilot submissions. We’re not just ready for MTD – we’re leading it.