Quarterly submissions are one of the biggest changes introduced by Making Tax Digital for Income Tax (MTD for ITSA). Instead of waiting until after the tax year to report income and expenses, sole trade businesses and landlords will now send updates to HMRC every quarter.
For many taxpayers, this represents a major shift in how they manage bookkeeping and tax reporting.
What are quarterly submissions?
These are summary updates sent to HMRC using MTD-compatible software.
They include:
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Business income
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Allowable expenses
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Property income where relevant
These submissions are not final tax returns. They are updates based on the digital records maintained throughout the year.
When are quarterly updates due?
For taxpayers using standard quarterly periods, deadlines are:
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7 August
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7 November
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7 February
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7 May
Each deadline falls shortly after the end of a reporting quarter.
Businesses need to maintain accurate digital records throughout the year to support these updates.
Do quarterly updates create tax bills? No.
Quarterly submissions do not create final tax calculations or immediate tax demands. They are designed to provide HMRC and taxpayers with a clearer picture of income and tax positions during the year.
The final tax position is still confirmed through the end-of-year process.
What are the benefits?
Although many businesses initially see quarterly reporting as extra admin, there are some advantages.
Better visibility:
Businesses gain a more up-to-date view of profits and tax liabilities.
Improved bookkeeping:
Regular record keeping often reduces year-end stress.
Fewer surprises:
Businesses may avoid unexpected tax bills because financial information is reviewed more regularly.
Digital organisation:
Cloud software can automate large parts of bookkeeping and reporting.
What information must be included?
Quarterly updates are based on digital transaction records, including:
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Sales income
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Business expenses
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Property income and costs
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Dates and categories of transactions
Some year-end adjustments are still completed later during the final declaration.
Do quarterly updates need to be perfect?
The short answer is not necessarily. HMRC has confirmed that quarterly updates are not intended to be final accounts. Corrections and adjustments can be made later during the year-end process.
This means businesses should focus on maintaining reasonable and accurate records rather than worrying about perfection every quarter.
What challenges do businesses face?
Common concerns include:
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Increased bookkeeping frequency
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Learning new software
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Managing deadlines
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Separating business and personal transactions
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Keeping receipts and records organised
For businesses that already maintain regular bookkeeping, the transition is often easier.
How businesses can prepare
Good preparation includes:
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Choosing MTD-compatible software
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Connecting bank accounts
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Updating bookkeeping monthly
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Setting internal reminders
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Reviewing records regularly
Many businesses also benefit from dedicated business bank accounts to simplify record keeping.
Will quarterly reporting become normal?
Most likely, yes. MTD for ITSA represents part of HMRC’s long-term strategy to modernise the tax system. Quarterly reporting is expected to become standard practice for many self-employed individuals and landlords.
Over time, businesses may become more comfortable with regular reporting as software automation improves.
Planning early will help ease the transition
Quarterly submissions are one of the most significant changes under MTD for ITSA. While they introduce more regular reporting obligations, they also encourage better bookkeeping habits and improved financial visibility.
Businesses that adapt early and build strong digital processes are likely to find the transition much smoother than those leaving preparation until the last minute.
For many, the time, stress, and risk of mistakes involved in managing this themselves can outweigh the cost of professional support. That’s why many people choose expert help to reduce pressure and avoid errors. Our MTD for ITSA accounting service is designed specifically for those impacted by the new requirements.
If you’d like more information on how we can take the stress and hassle way from getting set up for these new changes, speak to one of our team today on 0161 926 7866 or via smeaccounts@paystream.co.uk , or click here to find out more.
