Making Tax Digital for Income Tax / Lesson 6 of 7
The quarterly update cycle
Four deadlines a year sounds worse than it is. Here is what each one takes.
The short answer
- ✓ Quarters run from the start of the tax year, with about a month to submit each
- ✓ A submission is a reconcile-and-review job, not data entry, if records are current
- ✓ Errors can be corrected in a later update or at the final declaration
- ✓ Quarterly figures let you set tax money aside as you go
The rhythm of the year
Quarterly updates cover standard three-month periods running from the start of the tax year, and each is due one month and a few days after the period ends. That gap is deliberate: it gives you time to reconcile rather than submitting on the day the quarter closes.
Quarter 1 6 Apr to 5 Jul submit by early August
Quarter 2 6 Jul to 5 Oct submit by early November
Quarter 3 6 Oct to 5 Jan submit by early February
Quarter 4 6 Jan to 5 Apr submit by early May
Final declaration by 31 January following
Payment 31 January and 31 July, unchangedCheck the exact submission dates in your software, which will show them for your specific periods. Some products let you align quarters to calendar months instead, which is worth switching on if your bookkeeping already works that way.
What submitting actually involves
If your records are current, an update is a review rather than a data-entry session.
- Reconcile the period against your bank
- Check every transaction has a sensible category
- Look at the totals and ask whether they seem right
- Submit
Fifteen or twenty minutes for most small businesses. Considerably longer if you have not touched the records since the last submission, which is the whole point.
Getting something wrong
Errors in a quarterly update are not a crisis. You can correct a figure in a later update or at the final declaration. Nothing is fixed until the year is declared, which is precisely why quarterly updates are not four tax returns.
Do not let this become an excuse for sloppiness, though. Errors compound and the reconciliation gets harder the longer a mistake sits there.
The bit HMRC does not spell out
The quarterly cycle has an unexpected benefit that nobody advertises: you find out roughly what you owe as the year progresses, instead of discovering it in January. Traders who use their quarterly figures to set money aside as they go are far less likely to meet the January shortfall that catches out so many people under the old annual system.
Used well, MTD turns tax from an annual surprise into a running total. That is worth more than the compliance burden costs, but only if you actually look at the numbers rather than submitting and closing the laptop.
Common mistakes
- Leaving the records untouched between updates. That turns a 20-minute job into a weekend.
- Panicking about an error. Correct it in a later update or at the final declaration.
- Forgetting property and trade need separate updates. Two businesses, two submissions.
- Ignoring what the figures tell you. They are an early warning about your bill.
Try it on your own numbers
This is the same calculator as the full tool page, using 2026/27 rates.
Key UK tax & filing deadlines
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VAT returns and PAYE are usually monthly/quarterly - exact dates depend on your registration and accounting period. Always confirm yours on gov.uk.
personal reminders saved in this browser. They'll be here when you come back.
If you pay Self Assessment by payments on account, HMRC asks for two instalments - each is half your previous bill - plus any balancing payment. Enter last year's bill to see what's due and when.
Each payment on account is 50% of this. Payments on account aren't required if your last bill was under £1,000 or 80%+ was taxed at source.
- 1st payment on account · 31 Jan
- 2nd payment on account · 31 Jul
- Total payments on account
Key takeaways
- ✓ Quarters run from the start of the tax year, with about a month to submit each
- ✓ A submission is a reconcile-and-review job, not data entry, if records are current
- ✓ Errors can be corrected in a later update or at the final declaration
- ✓ Quarterly figures let you set tax money aside as you go
Check you have got it
3 quick questions. No score is kept, and you can change your mind.
1. You realise a quarterly update contained a wrong figure. What happens?
2. Roughly how long should a quarterly update take if your records are current?
3. What is the practical upside of quarterly reporting?
Sources
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