What you actually submit in an MTD quarterly update
Four submissions a year sounds like four tax returns. It is not. Here is what is genuinely in a quarterly update, what is deliberately left out, and where the real work moves to.
Last verified 31 July 2026. Prices are ex VAT and taken from each vendor’s own UK pricing pages. Promotional offers change roughly monthly and are normally for new customers only — check the live price before you subscribe.
An MTD quarterly update is a digital summary of your business income and expenses for a period, sent to HMRC from compatible software. You send four per tax year for each business source, then a final declaration after the year ends. It is not a tax return and it is not a tax bill.
The phrase “quarterly reporting” does more damage than the rule itself. People hear it and picture four Januarys a year. What is actually being asked for is much closer to pressing a button on books you have already kept up to date — which is why the burden lands on your bookkeeping habits rather than on the submission.
Not tax advice — confirm with HMRC or your accountant
This article is general information for UK businesses, not tax advice. Making Tax Digital thresholds, dates and rules are set by HMRC and can change. Before you act on anything here, confirm your own position on GOV.UK or with a qualified accountant.
What goes into a quarterly update
A quarterly update contains totals: your business income and your business expenses for the period, grouped into categories, sent digitally from your software to HMRC.
That is the substance of it. You are giving HMRC a periodic picture of trading activity, not a finished calculation. In practical terms, once your records are up to date, the update is generated from what is already in the software.
What is not in it
- No tax computation. The update does not work out what you owe.
- No reliefs or allowances. Those belong at the final declaration.
- No non-qualifying income. Employment income, dividends, savings interest and pensions are not part of a business quarterly update — they are outside qualifying income altogether.
- No accounting adjustments. Year-end adjustments are a final-declaration job, not a quarterly one.
A quarterly update is a photograph of your trading, not a verdict on your tax. The verdict comes once, at the final declaration.Fizoral
If you have both a trade and rental property, they are separate sources and are reported separately. A landlord who also does consultancy is not filing one merged update — see MTD for landlords for how property income is handled.
The four-updates-plus-final-declaration model
Making Tax Digital for Income Tax replaces one annual Self Assessment return with five touchpoints per business source: four in-year quarterly updates, then one final declaration after the tax year ends.
The final declaration is where the tax year is actually closed off. It is the point at which everything else about your position gets pulled in — the adjustments, the reliefs, the income that sits outside qualifying income — and the liability is settled. Think of the quarterly updates as keeping HMRC roughly informed through the year, and the final declaration as the moment of truth.
| Submission | How often | What it contains | Does it settle your tax? |
|---|---|---|---|
| Quarterly update | 4 per tax year | Summary totals of business income and expenses for the period | No |
| Final declaration | 1 per tax year | The complete picture: adjustments, reliefs, allowances and other income | Yes |
Structure verified 31 July 2026. The exact mechanics and dates are set by HMRC — confirm on GOV.UK. More detail on our quarterly updates page.
Multiple sources means multiple sets
The count is per business source, not per person. Two sources, two sets of quarterly updates. This is the detail that surprises landlords who also freelance, and it is worth checking before you assume your workload.
Why we are not giving you the deadline dates
Quarterly period ends and filing deadlines are set by HMRC, and we will not restate them here from memory. Take them from GOV.UK or from your accountant, and let your software’s built-in reminders do the tracking.
This will read as a cop-out. It is not. It is the single most-copied, least-checked set of figures in this whole subject, and a stale date republished across a hundred blogs is exactly how someone ends up filing late. The cost of us being confidently wrong about a date is a penalty on your account, not on ours.
What we will tell you is how to make the dates a non-issue:
- Let the software own the calendar. Every MTD-recognised package tracks your obligation periods and prompts you. That is what you are paying for.
- Reconcile weekly, not quarterly. If the books are current, no deadline is ever a scramble. The submission takes minutes.
- Check GOV.UK once, at the start of your first year. Then trust the software and stop re-reading blog posts about it.
Penalties
There is a points-based penalty regime attached to late MTD submissions. We are not publishing point values or penalty amounts here because those are HMRC figures and we will not risk quoting them wrong. Read the current regime on GOV.UK before you rely on any number you see online, including on this site.
What this means for how you keep records
Quarterly reporting does not add four big jobs a year. It removes the option of leaving your bookkeeping until January.
That is the real change, and it is worth being blunt about it. Under annual Self Assessment you could, in principle, ignore your records for eleven months and reconstruct them in a fortnight. Under MTD you are reporting while the year is still running, so the records have to be broadly current all the way through.
In practice that means:
- A connected bank feed. Manual entry is where most people fall behind. A feed that pulls transactions in automatically is the single biggest workload reduction available.
- Categorising as you go. Ten minutes a week beats a lost weekend a quarter.
- Digital receipts. Photograph and attach at the point of spending, not at the point of panic.
- A category structure that fits your trade. Set it up once, properly, before your first live quarter.
If you are currently on a spreadsheet, this is the decision point. Bridging software can keep a spreadsheet in play, but for most people moving properly is less work over the year — we have laid out both routes in moving from spreadsheets to accounting software before MTD.
And if you are not yet certain whether any of this applies to you, start with what the April 2027 £30,000 threshold means for you — that is the cohort with a live deadline.
Does your choice of software change what you submit?
No. Every MTD-recognised package sends HMRC the same thing. Xero, QuickBooks, FreeAgent and Sage are all on the recognised list, so quarterly-update capability is not a differentiator — it is table stakes.
What does differ is how much the software costs you once the introductory discount ends, and how much work it takes to keep the records current. On price, over 24 months on entry plans, ex VAT:
Ex VAT, verified 31 July 2026. Sage quotes +VAT and is normalised here. Promotions change roughly monthly and are normally for new customers only. FreeAgent is free permanently with a NatWest, RBS, Ulster Bank or Mettle account (Mettle requires one transaction a month).
We earn nothing from telling you this, but it is true: if you bank with NatWest, RBS, Ulster Bank or Mettle, FreeAgent costs you nothing at all — see how to get FreeAgent free. And QuickBooks is £121.20 cheaper than Xero over 24 months on entry plans.
Vendor pricing pages: Xero UK · QuickBooks UK · FreeAgent · Sage UK.
Quarterly update questions, answered
The questions people ask once they realise four submissions a year is real.
What is an MTD quarterly update?
A quarterly update is a digital summary of your business income and expenses for a period, sent to HMRC from MTD-compatible software. Under Making Tax Digital for Income Tax you send four of them per tax year, plus a final declaration after the year ends.
Is a quarterly update a tax return?
No. A quarterly update is a summary of totals, not a completed tax computation. Reliefs, allowances, adjustments and any non-qualifying income are dealt with at the final declaration stage, not in the quarterly updates.
Do I have to pay tax every quarter under MTD?
Quarterly updates are a reporting obligation, not a payment obligation — sending one does not itself create a tax bill. Payment dates for Income Tax are set separately by HMRC, so check your own payment position on GOV.UK or with your accountant rather than assuming it changes.
How many submissions are there in total each year?
Five per business source: four quarterly updates during the tax year, then one final declaration after the tax year ends. If you have both self-employment and property income you report them as separate sources.
What are the exact quarterly deadlines?
Period end dates and filing deadlines are set by HMRC and we deliberately do not restate them here, because a wrong date could cost you a penalty. Take them directly from GOV.UK or from your accountant, and let your software’s own deadline reminders do the tracking.
Do I need to submit a quarterly update if I had no income that quarter?
A quiet quarter does not automatically remove the obligation to report. Nil or low-activity periods still generally need an update. Confirm the position for your own circumstances on GOV.UK or with your accountant.
Which software can send quarterly updates?
Any package on HMRC’s recognised list. Xero, QuickBooks, FreeAgent and Sage are all on it, so quarterly-update capability is not a reason to pick one over another. Choose on 24-month cost and on fit.
Read next
Up to the pillar, across to the posts that pair with this one, down to what to actually buy.
Up — pillar
Making Tax Digital for Income Tax: the full guide
The whole rollout in one place: thresholds, dates, who is in and what changes.
Across — sibling post
What the April 2027 £30,000 threshold means for you
The live deadline. Who is caught, why 2025/26 decides it, and what to do with the months that are left.
Across — sibling post
Moving from spreadsheets to accounting software before MTD
Bridging software as an option, why most people are better off moving properly, and how to choose.
Down — review
FreeAgent review: £399, or £0 with the right bank
The package most often free at the point of use, and whether it earns its list price if it is not.
Down — what to buy
Best accounting software for UK sole traders
The sole trader shortlist, priced across 24 months instead of across the discount.
Down — head to head
Xero vs FreeAgent
£307.20 against £399 — unless your bank makes FreeAgent free, which changes the answer completely.