What are quarterly updates?
Quarterly reporting is a process of providing updates about business activity for the previous three-month period. This might be to provide managers with details about business activity, for example.
However, it has a special meaning in the context of Making Tax Digital (MTD) for Income Tax. Providing quarterly reports to HMRC about your income and expenditure—known as quarterly updates in the language of MTD—is a legal requirement for those who fall within scope.
In return for providing each update, HMRC will provide an estimate of your tax bill.
The quarterly updates should be provided across the year following April each year, as follows:
- First period of 6 April to 5 July: due 7 August
- Second period of 6 July to 5 October: due 7 November
- Third period of 6 October to 5 January: due 7 February
- Fourth period of 6 January to 5 April: due 7 May
The dates remain the same if you use month-end quarters, although the periods are adjusted (e.g. the first period is 1 April to 30 June).
Updates can be provided more frequently than the above dates, but they must be provided at least quarterly. Providing more frequent updates, such as monthly, makes a lot of sense because you’ll always have an idea of your tax position and therefore can better understand your cash flow.
Your Guide to MTD for Income Tax
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