MTD quarterly update: What to submit and when for Income Tax

Published Friday 6 December 2025

Table of contents

• Who needs to send quarterly updates under MTD for IT?
• What information is included in quarterly updates?
• Submitting your quarterly updates
• When will you need to send quarterly updates for MTD for IT?
• Benefits and compliance
• What are the penalties for late or incorrect submissions?
• FAQs on quarterly updates

Understanding MTD quarterly updates

Quarterly updates are digital reports you submit to HMRC four times a year instead of one annual tax return.

From April 2026, qualifying businesses must send these updates using MTD-compatible software. You'll also need to submit a final declaration, but quarterly updates handle most of your regular reporting throughout the year.

Who needs to send quarterly updates under MTD for IT?

Making Tax Digital for Income Tax (MTD for IT) applies to sole traders and landlords with gross income above certain thresholds:

• £50,000+ from April 2026: Mandatory compliance starts
• £30,000+ from April 2027: Extended to lower earners
• £20,000+ from April 2028: Final threshold implementation, as confirmed in the Spring Statement announcement.

If your annual gross income from self-employment or property exceeds these amounts, you must send quarterly updates using software that works with Making Tax Digital for Income Tax.

What information is included in quarterly updates?

Quarterly updates summarise your business finances for each three-month period. You'll report the income you've earned and the expenses you've incurred, which HMRC uses to track your tax position throughout the year. These updates are organised into two main categories:

Income includes:

• Sales of goods and services
• Rental income from properties
• Other business earnings

Expenses include:

• Business equipment purchases
• Software subscriptions and tools
• Operating costs like utilities and supplies

Your Making Tax Digital for Income Tax software automatically calculates totals for each quarter. Updates are cumulative, so you can correct previous submissions in later updates without penalties.

Submitting your quarterly updates

How do you send quarterly updates for MTD for Income Tax?

You must use software that works with Making Tax Digital for Income Tax to submit quarterly updates to HMRC. You cannot submit updates manually.

The process works like this:

• Keep digital records: Enter income and expenses regularly
• Generate reports: Software creates quarterly summaries
• Submit digitally: Send updates directly to HMRC through the software
• Receive confirmation: Get acknowledgment that HMRC received your submission

Who can submit quarterly updates for MTD for IT?

You or your accountant or bookkeeper can submit your quarterly updates for Making Tax Digital for Income Tax. If you want your accountant or bookkeeper to submit updates for you, you need to authorise them. Ask your advisor or your software provider for more information.

When will you need to send quarterly updates for MTD for IT?

You have one month after each period ends to submit your quarterly update, with official deadlines for quarterly updates falling on the 7th of the month after the quarter's end.

Standard quarterly periods and deadlines:

Quarter 1: 6 April – 5 July Deadline: 7 August

Quarter 2: 6 July – 5 October Deadline: 7 November

Quarter 3: 6 October – 5 January Deadline: 7 February

Quarter 4: 6 January – 5 April Deadline: 7 May

Each update includes your totals for the year so far, so you can correct earlier quarters in later submissions.

Benefits and compliance

Why are quarterly updates needed?

Quarterly updates make tax reporting easier by breaking your annual requirements into four smaller submissions. For the similar Making Tax Digital for VAT scheme, an independent report found that 67% of businesses said the new system reduced mistakes in their record keeping.

Quarterly updates offer these benefits:

• Reduced complexity: Less information required per submission
• Better cash flow planning: Regular tax estimates help you budget
• Up-to-date records: Encourages consistent bookkeeping throughout the year
• Earlier preparation: More time to arrange tax payments before deadlines

What are the penalties for late or incorrect submissions?

MTD penalties apply to both late submissions and late payments.

Filing penalties:

• One penalty point per missed deadline
• £200 fine after accumulating four penalty points; the penalty system issues points for missed deadlines, which results in a £200 penalty once a certain threshold is reached.
• Points reset annually if you meet all deadlines

Payment penalties:

• Day 15: 3% penalty on outstanding tax
• Day 30: Additional 2% penalty
• Day 31+: 10% annual penalty rate on remaining balance

If you cannot pay on time, contact HMRC as soon as possible to arrange a payment plan.

What about the final declaration?

In your final declaration, you disclose other income, such as investments or savings, and submit any claims for relief. You must submit your final declaration and payment by 31 January.

FAQs on quarterly updates

Here are answers to common questions about quarterly updates for Making Tax Digital for Income Tax.

How long does it take HMRC to update payments?

It can take up to seven days for a digital or online payment to appear in your HMRC account. Make your payment as soon as possible to ensure it reaches HMRC before the deadline.

What are the quarter days for HMRC?

The four standard quarterly update periods for MTD for IT are:

• 6 April – 5 July (to be submitted by 7 August)
• 6 July – 5 October (to be submitted by 7 November)
• 6 October – 5 January (to be submitted by 7 February)
• 6 January – 5 April (to be submitted by 7 May)

How long does it take HMRC to register a quarterly update?

It can take up to an hour for HMRC to register a quarterly update or final declaration submission. Be sure to submit early to ensure it reaches HMRC on time.

How does HMRC notify you of a tax refund?

If you think you have overpaid tax, use HMRC's tool to check how to claim a tax refund. In your online Self Assessment account, select 'request a repayment'. If you do not have an online account, set one up or contact HMRC. You usually receive your refund within two weeks. If you do not receive it, wait four weeks before contacting HMRC.