What are quarterly updates?

4 min read

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.

What counts as a quarterly update?

In return for providing each update, HMRC will provide an estimate of your tax bill.

A quarterly update is a running summary, not a final calculation. It’s generated and sent through MTD-compatible software — typically the totals for your income and expenses for that period, broken down by category, or as a simplified three-line summary if your turnover is below the VAT registration threshold.

Do I need to submit more than one quarterly update?

Yes, if you have more than one qualifying income source. You’ll need a separate quarterly update for each sole trader business you run, and a separate update for your property income (with foreign property reported separately from UK property).

For example, if you run a landscaping business as a sole trader and also let out a rental property, you’ll need to submit two quarterly updates every three months: one covering your landscaping income and expenses, and one covering your rental income and expenses. That’s eight updates a year in total, rather than four.

When are quarterly updates due?

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.

Quarterly updates vs the year-end tax return

Quarterly updates are easy to confuse with the digital tax return you submit at the end of the tax year. They serve different purposes:

	Quarterly update	Digital tax return (year-end)
Frequency	At least every 3 months	Once a year, by 31 January
Purpose	Running estimate of tax owed	Final, confirmed tax calculation
Includes a legal declaration	No	Yes — you review and digitally sign it
Penalty for inaccuracy	None	Can apply if figures are wrong

Can my accountant submit quarterly updates for me?

Yes. Quarterly updates are generated in MTD-compatible software by either you or your accountant or bookkeeper, and can be submitted on your behalf. Many people handle quarterly updates themselves — since it’s often just a matter of reviewing the figures and clicking submit — and leave the more complex year-end tax return to their accountant.

Frequently asked questions about quarterly updates

Do quarterly updates need to be 100% accurate?

No. Quarterly updates don’t include a formal declaration, so there’s no inaccuracy penalty attached to them — accuracy matters for a reliable tax estimate, but corrections can be made in a later update or at your year-end digital tax return.

What happens if I miss a quarterly update deadline?

For the first year of MTD for Income Tax (2026/27), HMRC isn’t issuing penalty points for late quarterly updates. From 2027/28, missed deadlines earn penalty points under HMRC’s points-based system, with a fine once a threshold is reached.

Do I need to submit a separate quarterly update for each business or property?

Yes. Each sole trader business and your property income (UK and foreign property separately) each need their own quarterly update, submitted through the same piece of MTD-compatible software.

Are quarterly updates the same as a tax return?

No. A quarterly update is a running summary used to estimate your tax position. Your tax return — submitted once a year — is the final, legally signed calculation that brings everything together.

Can my accountant submit quarterly updates on my behalf?

Yes. Your accountant or bookkeeper can prepare and submit quarterly updates for you through MTD-compatible software, though you remain responsible for the accuracy of your year-end tax return.

MTD: Your business survival guide

Your real world guide to using Making Tax Digital for Income Tax in April 2026, April 2027 or April 2028. For sole traders, landlords, freelancers, side-hustlers—and more.

Get MTD for Income Tax: The business survival guide