2nd July 2026
If you're preparing to submit your first Making Tax Digital (MTD) quarterly update, you may be wondering where to start. While the process is relatively straightforward, there are a few important steps you'll need to complete before you can send your update to HMRC.
Whether you're a sole trader, landlord, or have both self-employment and property income, this guide explains what you need to do before submitting your first quarterly update, how to submit it, and what happens next.
Before you submit your first quarterly update
1. Register for Making Tax Digital with HMRC
Before you can submit quarterly updates, you'll need to register for Making Tax Digital (MTD) for Income Tax with HMRC.
Registration isn't automatic, even if you've previously submitted Self-Assessment tax returns. Once HMRC has confirmed your registration, you'll be able to submit your quarterly updates using compatible software.
If you've already registered, you're ready for the next step.
2. Use HMRC-compatible software
Making Tax Digital requires you to use compatible software to keep digital records and submit your quarterly updates.
Compatible software allows you to:
- Record your business or property income and expenses digitally.
- Keep your records organised throughout the year.
- Review your quarterly figures before submitting.
- Send quarterly updates directly to HMRC.
- Complete your end-of-year tax return.
Choosing software that fits your needs will make quarterly reporting much easier and help you stay on top of your bookkeeping throughout the year.
3. Get your records up to date
Before submitting your quarterly update, make sure you've recorded all the income and allowable expenses for the reporting period.
This may include:
- Business income.
- Rental income (if applicable).
- Allowable business or property expenses.
- Outstanding invoices, receipts or transactions that belong in the reporting period.
Keeping your records up to date throughout the quarter means you'll spend less time preparing your submission when the deadline approaches.
How to submit your quarterly update
Once your records are complete, submitting your quarterly update is usually quick and straightforward.
Review your figures
Your compatible software will prepare a summary of your income and expenses for the reporting period.
Take a few moments to review the figures and check for any missing transactions, duplicate entries or incorrect expense categories before submitting.
Submit your update to HMRC
When you're happy that your records are complete and accurate, submit your quarterly update through your software.
Your software will securely send the required information to HMRC, and you'll usually receive confirmation that your update has been successfully received.
What happens after you've submitted?
Submitting a quarterly update doesn't finalise your tax bill, but it can give you an estimated view of what you might owe based on the information you've provided so far.
Instead, it's one of several updates you'll submit throughout the tax year. After your final quarterly update, you'll complete the end-of-year finalisation process. This is where any accounting or tax adjustments are made, other taxable income is taken into account where required, and your final Income Tax position is confirmed.
Common mistakes to avoid
Your first quarterly update is often the biggest learning curve. Avoiding these common mistakes can help make the process much smoother.
- Leaving your bookkeeping until just before the deadline.
- Forgetting to record income or allowable expenses.
- Missing receipts or invoices that relate to the reporting period.
- Assuming a quarterly update is the same as a tax return.
- Forgetting to register for Making Tax Digital before attempting to submit.
Before you hit submit
Use this quick checklist before sending your quarterly update to HMRC.
✓ You've registered for Making Tax Digital for Income Tax with HMRC.
✓ You're using HMRC-compatible software.
✓ You've recorded all income for the reporting period.
✓ You've added all allowable business or property expenses.
✓ You've checked for missing or duplicate transactions.
✓ You've reviewed your quarterly summary.
✓ You've submitted your update before the quarterly deadline.
Make future submissions easier
The first quarterly update usually takes the longest because you're getting familiar with the process. Once everything is set up, future submissions become much quicker.
Setting aside a little time each week or month to keep your records up to date can save hours before each quarterly deadline. You'll also have a clearer picture of your business or property finances throughout the year, making it easier to monitor cash flow and prepare for your tax obligations.
By building good bookkeeping habits now and using compatible software, quarterly reporting soon becomes another straightforward part of running your business or managing your rental property.
About Coconut
Coconut is your Self-Assessment and Making Tax Digital for Income Tax solution brought to you by the team at GoSimpleTax.
✅ Built specifically for the self-employed, freelancers, landlords and CIS Subcontractors
✅ MTD for Income Tax ready
✅ Track income and expenses with ease
✅ Capture receipts on the go
✅ Send invoices and see how much tax you owe
✅ No accounting jargon – just a simple, powerful app
Whether you're managing your finances solo or working with an accountant, Coconut takes the stress out of tax and helps you stay compliant.
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Article by Coconut