What Is a Quarterly Update Under MTD ITSA?
A quarterly update is a digital submission sent directly to HMRC via your MTD-compatible software. It contains a categorised summary of your income and allowable expenses for a three-month period. It is not a payment — it is a reporting event that updates HMRC’s running estimate of your tax liability.
A quarterly update is not a tax payment, not a detailed transaction list, and not the same as a Self Assessment return. It is a summary of totals — your software compiles the numbers; you (or AccTek) reviews and submits them.
The Four Quarterly Deadlines — Full Calendar
| Quarter | Period Covered | Submission Deadline | What HMRC Does |
|---|---|---|---|
| Q1 | 6 Apr – 5 Jul | 5 August | Updates your estimated tax position |
| Q2 | 6 Jul – 5 Oct | 5 November | Updates estimate based on 6 months of data |
| Q3 | 6 Oct – 5 Jan | 5 February | Updates estimate based on 9 months of data |
| Q4 | 6 Jan – 5 Apr | 5 May | Full year income/expense picture available |
| Final Declaration | Full tax year | 31 January | Tax liability confirmed and payment due |
Step by Step: How a Quarterly Submission Works
- Records are kept throughout the quarter — rental income is logged as received; expenses are entered as they are incurred. With bank feeds enabled in Xero, most transactions are imported automatically.
- AccTek reviews the quarter’s records — approximately 2–3 weeks before the deadline, we review your income and expenses for completeness and accuracy. We flag any uncategorised items or unusual entries for your attention.
- The quarterly summary is compiled — the software aggregates your records into HMRC’s required categories: total income, repairs and maintenance, finance costs, professional fees, and other expenses.
- Submission is sent to HMRC — with your authorisation, the quarterly update is submitted via the MTD API. HMRC acknowledges receipt and updates your estimated tax position.
- You receive a summary — AccTek sends you a brief quarterly summary showing income, expenses, and HMRC’s updated tax estimate. No surprises in January.
What the Quarterly Update Contains — For Landlords
| Category | Example |
|---|---|
| Property income | Total rent received during the quarter |
| Repairs and maintenance | Plumbing repair £400, cleaning £150 |
| Finance costs | Mortgage interest for the quarter |
| Letting agent fees | Management fee 10% of rent collected |
| Insurance | Buildings insurance quarterly premium |
| Other allowable expenses | Accountancy fee, advertising |
What Happens After Each Quarterly Submission?
After each submission, HMRC calculates an estimated in-year tax position based on the data received so far. This estimate is available through your MTD software or HMRC’s online account. It is not a tax demand — it is a forecast based on the year to date.
The value of this is significant: rather than discovering a large tax bill in January, you can see your likely liability building throughout the year and plan accordingly. If you know by November that your estimated liability is £8,000, you can begin setting funds aside rather than scrambling in January.
The End of Year Process — Final Declaration
After your fourth quarterly update, you submit a Final Declaration by 31 January. This replaces the old Self Assessment return and is where you:
- Confirm that all quarterly updates are accurate
- Add any year-end adjustments (capital allowances, private use adjustments)
- Include other income not covered by quarterly updates (employment income, dividends, bank interest, capital gains)
- Apply reliefs and allowances (personal allowance, pension contributions, gift aid)
- Calculate and confirm your final tax liability
The tax payment deadline remains 31 January — the same as under Self Assessment.
Can You Correct a Quarterly Update After Submission?
Yes. If you discover an error in a submitted quarterly update, it can be corrected in your next quarterly submission or in the Final Declaration. HMRC’s system is designed to accommodate corrections — the important thing is that the Final Declaration reflects accurate, complete figures.
What Happens If You Miss a Quarterly Deadline?
Missing a quarterly submission deadline triggers a penalty point under HMRC’s new points-based system. Accumulate four points and a £200 financial penalty applies. Each subsequent late submission adds another £200. Points reset after a sustained period of compliance. See our full guide to MTD ITSA penalties.
MTD Quarterly Reporting vs Old Self Assessment — Practical Difference
| Self Assessment (Old) | MTD Quarterly Reporting (New) |
|---|---|
| Gather all records in December/January | Records updated throughout the year |
| One stressful annual submission | Four smaller, routine submissions |
| No tax estimate until return filed | Running estimate updated each quarter |
| Risk of missed transactions | Bank feeds reduce missed entries |
| Accountant works intensively once a year | Accountant reviews lightly each quarter |
Frequently Asked Questions
Never miss a quarterly deadline
AccTek tracks every submission date and files on your behalf — all included in your fixed monthly fee.