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Quarterly Updates with QuickBooks ONLINE

  • Writer: Paul Whitehouse
    Paul Whitehouse
  • Jul 11
  • 3 min read

Making Tax Digital for Income Tax (MTD IT) changes the way sole traders and landlords report their income tax to HMRC. This new system aims to simplify tax reporting, reduce errors, and help you stay on top of your finances throughout the year. If you use QuickBooks, understanding how to manage quarterly updates can make the transition smoother and keep your tax affairs in order.






The New MTD Filing Journey


Before MTD, sole traders and landlords submitted one Self Assessment tax return each year.


You now submit four quarterly updates during the tax year, followed by a final declaration once the year ends. This spreads the reporting workload and helps you track your tax position more regularly.


Each quarterly update covers business income and expenses for that period. The final declaration confirms the full year’s figures and calculates your tax liability.


This approach encourages better record-keeping and reduces the risk of surprises at the end of the year.


What You Need to Know About Quarterly Updates


A quarterly update is not a full tax return. It is a summary of your business income and expenses for the quarter. You do not include tax adjustments, reliefs, or personal income at this stage.


What to Include in a Quarterly Update


  • Total business income received during the quarter

  • Total business expenses incurred during the quarter


What to Leave Out


  • Personal income and expenses

  • Tax relief claims

  • Adjustments for capital allowances or other tax-specific items


Filing Your Updates in QuickBooks


QuickBooks supports Making Tax Digital for Income Tax by integrating with HMRC’s systems.


Knowing when you are ready to file?

Before submitting your quarterly update in QuickBooks, make sure to:


  • Review your bank transactions: Check that all imported banking transactions are matched to the correct invoices or expenses.

  • Categorise expenses correctly: Assign each expense to the right category to ensure accurate reporting.

  • Clear any uncategorised items: Resolve any transactions that QuickBooks flags as uncategorised to avoid missing data.


When you see the green ticks on all your accounts and no transactions are uncategorised in your Profit and Loss, you are ready to file!



How to Submit in QuickBooks


  1. Open the Income Tax App within QuickBooks.

  2. Select the quarter you want to file.

  3. Review the figures carefully and ensure they make sense to you.

  4. Submit directly to HMRC through QuickBooks.


This process simplifies filing and keeps your tax data connected and up to date.


Practical Tips for Managing Quarterly Updates


  • Set reminders for each quarterly deadline to avoid last-minute rushes.

  • Keep your bookkeeping up to date throughout the quarter to make filing easier.

  • Use QuickBooks banking rules to automatically categorise repeat transactions like direct debits and reduce manual entry.

  • Review reports regularly to spot any discrepancies early.

  • Consult a tax advisor if you have complex income streams or expenses.


What Happens After the Final Declaration


The final declaration confirms that all quarterly updates are complete and accurate, which is then used to calculate your tax.


Things to know

  • Annual deadline: Although updates occur quarterly, you are required to submit a single Final Declaration by January 31 following the close of the tax year.

  • Error Checking: If you identify an error in an earlier quarterly update, there's no need to worry—the Final Declaration allows you to correct those figures before the tax year concludes.

  • Payment deadlines: The deadlines are still 31 January for the balancing payment and 31 July for the payment on account. your not calculating tax every 3 months so no payment is requested by HMRC.



Need Help?

MTD IT is a massive change for many sole traders and landlords and it can feel overwhelming. Our team at Chariot Accountants are ready to support your business needs in both the Quarterly Updates and the Final Declaration.


We start by setting up your QuickBooks Online account and planning your quarterly submissions. We keep your records accurate and review the reports regularly. We process all the submissions on your behalf and can complete your tax obligations when its time for that Final Declaration!

This approach will keep your tax filing smooth and compliant under the new MTD rules allowing you to focus on doing what you enjoy.


Check out our exclusive MTD Pricing or give us a call and see how we can get you prepared with Quickbooks Online.


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