The new heartbeat of Making Tax Digital — a short, cumulative income-and-expense summary sent to HMRC every three months.
The quarterly update is the single most visible change Making Tax Digital brings to a sole trader's year. Instead of one annual reckoning, you send HMRC a short summary of how the business is doing every three months. It sounds onerous; in practice, with good software it is closer to clicking "submit" on figures you are already keeping.
A quarterly update is deliberately light. For each business — each trade and each property business is reported separately — you submit a cumulative total of income and a breakdown of expenses by category, drawn straight from your digital records. There is no need for adjustments, reliefs or final figures at this stage; those are added later in the final declaration. The update is a snapshot of the business's raw numbers, nothing more.
Because the totals are cumulative, each update effectively restates the year so far and can correct earlier figures, so a small mistake in quarter one is simply tidied up in quarter two rather than requiring a formal amendment.
The default ("standard") MTD quarters and their submission deadlines are:
| Quarter | Period | Deadline |
|---|---|---|
| Q1 | 6 April – 5 July | 7 August |
| Q2 | 6 July – 5 October | 7 November |
| Q3 | 6 October – 5 January | 7 February |
| Q4 | 6 January – 5 April | 7 May |
Each update is due on the 7th of the second month after the quarter ends. If you prefer round month-ends, you can elect for calendar quarters (ending 30 June, 30 September, 31 December and 31 March), with the same 7th-of-the-second-month deadlines.
Suppose Hannah, a self-employed gardener earning above £50,000, enters MTD for ITSA from 6 April 2026. Her first MTD year is 2026/27.
By 7 August 2026 she submits Q1: income and expenses for 6 April to 5 July. Say that is £14,000 income and £3,000 expenses.
By 7 November 2026 she submits Q2 as a cumulative total covering 6 April to 5 October — for example £29,000 income and £6,500 expenses year-to-date. She does not report Q2 in isolation; she restates the running total. Q3 (by 7 February 2027) and Q4 (by 7 May 2027) follow the same way. None of these trigger a payment. Use the quarterly planner to set aside tax alongside each update so January never bites.
The most common misunderstanding is that quarterly updates mean paying tax four times a year. They do not. The updates are purely informational — they keep HMRC's picture of your income current, but they create no liability and demand no payment. Your tax continues to be paid on 31 January and 31 July through payments on account and the balancing payment, exactly as under standard Self Assessment. What changes is your visibility: because HMRC and your software hold up-to-date figures, you can see an estimated tax position throughout the year instead of discovering it at the end.
A quarterly update is a check-in, not a cheque. It tells HMRC how the year is going; it never asks you to pay until the usual January and July dates.
Four quarterly updates do not, on their own, finalise your tax. After the tax year ends you make a final declaration, where you bring together all your income (including employment, savings, dividends and any other sources), claim reliefs and allowances, make accounting adjustments, and confirm everything is correct. This replaces the old annual Self Assessment return. Missing a quarterly update earns a penalty point under the points-based system; accumulate four points as a quarterly filer and a £200 penalty applies.
TapTax connects to your bank, categorises expenses automatically, and submits quarterly updates to HMRC. Free plan, no card required.
