MTD Quarterly Submissions Explained: What You Actually Have to Send HMRC

The thing everyone gets wrong about quarterly updates

When people hear "quarterly submission," they imagine four full tax returns a year. That is not what this is.

A quarterly update is a summary total of your income and expenses for that three-month period. You are telling HMRC: "In this quarter, I received £X in income and spent £Y on business costs." That is essentially it.

No VAT calculations. No individual receipt listings. No tax calculation. Just income and expenses.

Your MTD-compatible software generates the submission from your records. Once your records are up to date, the submission itself typically takes under 30 minutes — often much less.

The four quarterly deadlines

Each year runs from 6 April to 5 April. The deadlines are fixed:

| Quarter | Period covered | Deadline | |---------|----------------|----------| | Q1 | 6 April – 5 July | 5 August | | Q2 | 6 July – 5 October | 5 November | | Q3 | 6 October – 5 January | 5 February | | Q4 | 6 January – 5 April | 5 May |

For the 2026/27 tax year (the first year Phase 1 is active), the specific dates are:

• Q1: 5 August 2026
• Q2: 5 November 2026
• Q3: 5 February 2027
• Q4: 5 May 2027

What a quarterly update actually contains

When you submit a quarterly update, you are sending:

For self-employment:

• Total turnover (gross income received)
• Total expenses broken down by HMRC category:
  • Cost of goods/materials
  • Car, van, and travel expenses
  • Office costs
  • Repairs and maintenance
  • Staff costs (if applicable)
  • Professional fees
  • Financial charges
  • Advertising and marketing
  • Other business expenses

For property income (landlords):

• Total rental income received
• Total expenses:
  • Letting agent and management fees
  • Repairs and maintenance
  • Insurance
  • Finance costs (if applicable — though mortgage interest relief is typically handled at final declaration)
  • Other allowable costs

You do not send individual invoices, receipts, or bank statements. Just the category totals.

What happens after you submit

Once you submit a quarterly update, HMRC uses the data to update your in-year tax estimate. Your MTD software or the HMRC app will show you an estimated tax position based on year-to-date figures.

This is useful for budgeting. If your income has been higher than expected, your estimated tax will reflect that and you can set money aside accordingly.

Important: No payment is triggered by a quarterly update. The actual tax payment deadline remains 31 January (for the previous tax year's liability, as before).

The final declaration: what goes in there

After 5 April each year, you complete a final declaration (formerly Self Assessment). This is where you:

1. Confirm your quarterly totals are accurate (you can make corrections if needed)
2. Add any income sources not covered quarterly:
   • PAYE employment income
   • Savings interest
   • Dividends
   • Pension income
   • Capital gains
3. Claim any additional reliefs (gift aid, pension contributions, marriage allowance)
4. Review your final tax calculation and confirm it

The final declaration deadline is 31 January — same as Self Assessment always was. Your tax payment is also due on 31 January.

What happens if you miss a quarterly deadline?

Year 1 (2026/27): HMRC grace period

For the first year of MTD, HMRC has confirmed a light-touch approach. If you are clearly trying to comply but miss a deadline or make an error, you will not automatically face penalties. HMRC has acknowledged that the first year will have teething problems.

This grace period applies to people who are clearly trying. It is not a free pass to ignore the requirements.

From 2027/28 onwards: penalty points system

Missing a quarterly submission earns you a penalty point. Once you accumulate 4 points within a 12-month rolling period, you are charged a £200 penalty.

After the £200 penalty is triggered, every subsequent late submission incurs an additional £200 until you have filed on time for 24 consecutive months and your points are wiped.

There are also separate penalties for:

• Inaccurate submissions (understating income by more than a threshold)
• Late final declaration (same as current Self Assessment late filing penalties: £100 immediately, more after 3 and 6 months)

What counts as "on time"?

A quarterly update must be received by HMRC by midnight on the deadline date. Most software shows a confirmation once your submission is accepted. Keep this confirmation for your records.

Common misconceptions about quarterly submissions

"I need to send HMRC my bank statements." No. HMRC never sees your raw bank data. You send summary totals. Your records stay in your software.

"I need to calculate my tax each quarter." No. HMRC calculates an estimate, but you owe nothing until the final declaration is confirmed and the January payment is due.

"Quarterly submissions replace Self Assessment completely." No. The final declaration still happens every January. Quarterly updates add to the process; they do not replace the end-of-year step.

"If I have an accountant, I do not need to worry." Partly true — your accountant can handle the submissions, but your underlying records still need to be kept digitally in real time. They cannot file accurately if your records are six months behind.

"I only need software at the quarterly deadline." No. The whole point of MTD is ongoing digital record keeping. You are expected to record income and expenses throughout the quarter, not scramble to enter three months of data the day before the deadline.

Making the process as painless as possible

The sole traders and landlords who find MTD easy are the ones who treat record keeping as a habit rather than a chore:

• Log income when it lands in your account. Most software has a mobile app where you can do this in 30 seconds.
• Photograph receipts immediately. Most apps let you attach a receipt photo to an expense entry on the spot.
• Do a 15-minute weekly tidy-up. Review the week's transactions, categorise anything the software did not auto-categorise, and you will never face a pile-up at deadline time.

The MTD Ready kit

Want a clear, personalised plan for your quarterly submission workflow? The MTD Ready kit includes a step-by-step action plan based on your specific setup, plus a software comparison guide. One-time £29.

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Frequently Asked Questions

Do I submit one quarterly update or separate ones for self-employment and property?

If you have both self-employment and UK property income, you submit separate quarterly updates for each income source. Your MTD-compatible software handles this, but you need to ensure both income streams are set up correctly within the software.

Can I amend a quarterly update after I have submitted it?

Yes. You can correct errors in a submitted quarterly update by submitting an amended update for the same period. The most recent submission for a period is the one HMRC uses. There is no penalty for correcting genuine errors.

What if my income is seasonal and I have nothing to report in some quarters?

You must still submit a quarterly update for every quarter, even if your income was nil. A nil return is still a return. Missing it counts as a missed submission for penalty points purposes.

Can I submit quarterly updates early?

Yes. You can submit a quarterly update any time after the quarter has ended and before the deadline. Many accountants submit as soon as their clients' records are ready, rather than waiting until the deadline. Early submission is fine and sensible.

What software do I need to keep my records in?

Any HMRC-approved MTD-compatible software. You cannot use a paper ledger or an unsupported spreadsheet as your sole record. If you want to use a spreadsheet as your primary record, you need to pair it with MTD bridging software that can submit from it.

Does submitting quarterly updates affect my payment on account?

Yes, potentially. HMRC's payment on account system (advance payments towards your tax bill) uses your estimated income. Under MTD, HMRC has more in-year data, which may eventually affect how payment on account amounts are calculated. Currently, the final declaration process still governs when payments are due and in what amount.