A "quarterly update" sounds like a big deal, but it's a summary, not a tax return. This guide explains what's actually in one, when you send it, what happens if you get something wrong, and why you shouldn't lose sleep over it.
What a quarterly update is
A short file your software sends to HMRC containing totals for the tax year so far: how much income you've had, and how much you've spent, up to the end of the quarter.
That's all. There's no narrative, no explanations, no supporting documents. Just numbers.
What a quarterly update is not
- It's not a tax return. You don't calculate tax owed. You don't claim reliefs or allowances. You don't include other income (employment, pensions, interest). All of that happens at the final declaration in January, see The final declaration.
- It's not a payment. No tax is paid at quarterly updates.
- It's not irreversible. If you spot a mistake later, you fix it in the next update. More below.
The key idea: cumulative submissions
Each quarterly update contains everything for the tax year so far, not just the last three months. So Q2 includes Q1 plus Q2; Q3 includes Q1+Q2+Q3; Q4 is the full year.
The benefit: HMRC only ever has to look at the latest submission to see your current position. And if you fix a mistake in an earlier quarter, the next update automatically contains the corrected figure, with no separate "amendment" form needed.
What's in a typical quarterly update
For a sole trader under £90,000 turnover, a Q1 update might be just:
Business: "Jane Smith Plumbing"
Period: 6 April 2026 to 5 July 2026
Income: £14,250.00
Expenses: £3,120.00 (consolidated)
For the same trader in Q2, the update covers the year to date:
Business: "Jane Smith Plumbing"
Period: 6 April 2026 to 5 October 2026
Income: £29,800.00
Expenses: £6,405.00 (consolidated)
A landlord's update would be similar, but with expenses broken into the landlord categories (premises costs, finance, repairs, etc.). A sole trader over £90k would have expenses split into the self-employment categories instead of one consolidated figure.
The deadlines
Standard quarters (the default):
Same pattern every year. Calendar quarters (optional) end on the last day of the month instead, see Key dates.
What the process actually feels like
A well-kept week-by-week record means the update itself is almost nothing. Typical flow:
- A day or two before the deadline, your software prompts you: "Q1 update is due. Review and submit?"
- You look at the totals. Do they make sense? Any odd-looking transactions flagged?
- You reconcile anything outstanding (a few bank transactions not yet categorised, say).
- You click Submit. Your software sends it to HMRC.
- HMRC's response comes back, usually within seconds, confirming receipt. Your software marks the quarter as submitted.
That's the whole ritual. Most people, once they're in the rhythm, do this in under 15 minutes.
If you have more than one business
You submit one update per business, per quarter. So a sole trader who's also a landlord submits:
- Q1 sole-trade update
- Q1 property update
Two updates, same day, same button click in most software. Your software will usually prompt them together.
A landlord with multiple rental properties is still one property business, not one per property, so you don't multiply updates by the number of houses. The single property update includes totals across the whole portfolio.
What if I'm still reconciling when the deadline hits?
You have a few options:
- Submit with your best estimate. If something's unclear, submit what you have and correct it in the next update. No penalty for corrections.
- Wait, then submit late. In the first year (2026-27), late quarterly updates don't earn penalty points, they're covered by HMRC's easement. From 2027-28 onwards, a late update costs you a point, but you need four points before a penalty.
- Let your software auto-submit. If your records are up to date, some software can auto-file on the deadline. Check the settings.
See Penalties for the detail.
What to do if HMRC rejects your update
Rejections are rare and usually caused by:
- Data that doesn't add up (negative income where none is expected, badly-formatted figures).
- Attempting to submit before the quarter has ended.
- Attempting to submit for a tax year that isn't open yet.
Your software will tell you what HMRC said was wrong. Fix it, resubmit. You don't lose a point for a rejected submission that you then fix. The deadline is only missed if you don't end up filing on time.
Will I see my tax bill after each quarter?
Not officially. MTD software can show you an estimate based on your figures and standard rules, and many tools do, it's a genuinely useful feature. But HMRC's own systems don't produce a binding tax calculation until you trigger one (usually with the final declaration).
Treat any in-year estimate as a guide, not a promise. Employment income, reliefs, student loans and unusual items can change the final number materially.
In short
Quarterly updates are designed to be light. HMRC has explicitly described them as "light-touch". If you keep your records reasonably tidy throughout the quarter, filing takes minutes.
The first year has the quarterly-update easement on top of that, so anyone genuinely trying to do this right has room to find their feet without financial pain.