Getting ready for your first MTD quarterly update

Making Tax Digital for Income Tax (MTD for Income Tax) is the way HMRC wants landlords and the self-employed to keep records and report. Instead of one big annual Self Assessment, you keep digital records, send four quarterly updates across the tax year, and finish with one tax return.

This piece is about getting ready for that first quarterly update so that, when the time comes, it takes a few minutes rather than a lost weekend.

When this actually applies to you

MTD for Income Tax is being phased in based on your qualifying income, which is your gross rental and self-employment income before you take off any expenses. The dates are:

• Over £50,000: from 6 April 2026
• Over £30,000: from 6 April 2027
• Over £20,000: from 6 April 2028

If your qualifying income is under £20,000, you are not required to join yet, though it is worth keeping half an eye on the threshold as your income changes. Before you do anything else, check which group you are in. There is no point preparing for a deadline that does not apply to you.

What a quarterly update is

A quarterly update is not a tax bill, and it is not a final figure you will be held to. It is a summary of your income and expenses for the year so far, sent to HMRC. There is no working out your tax, no claiming reliefs and no final sums at this stage.

From 2025-26 onwards the updates are cumulative, so each one shows your year-to-date totals rather than that quarter on its own. If you make a small slip early in the year, the next update reflects the corrected running figure, which takes the pressure off getting every penny perfect first time.

The standard quarters end on 5 July, 5 October, 5 January and 5 April, and each update is due about a month later:

• Quarter ending 5 July, due 7 August
• Quarter ending 5 October, due 7 November
• Quarter ending 5 January, due 7 February
• Quarter ending 5 April, due 7 May

After the tax year ends you submit one tax return by 31 January to tie everything together and confirm your figures. If you have done Self Assessment, you will recognise that date. It has not changed.

Little and often beats the January scramble

For years the ritual has been the same: a shoebox of receipts, a long evening in January, and a promise to be more organised next time. MTD is built around regular check-ins, so it rewards keeping pace with it rather than leaving everything to the deadline.

Leaving it all until the end works against you. That £40 you paid a handyman in May is a distant memory by January, and forgotten expenses can mean paying more tax than you need to. Twelve months of bank statements and invoices is daunting in one go, whereas the same paperwork handled a month at a time barely registers. Rushing also breeds errors, and errors with HMRC are tedious to unpick. On top of that, if you only look at your numbers once a year, you have no real sense of how your property is performing.

Keeping on top of things month by month does not need to take over your life. For most landlords with one property or a small portfolio, a workable habit looks like this:

• Note the rent when it lands, or let your software pick it up.
• Record a repair, an insurance renewal or a letting agent's fee in the same week you pay it.
• Photograph any paper receipt before it disappears into a coat pocket.
• Once a month, spend ten minutes checking everything is captured and the categories look right.

Do that, and when a quarterly deadline arrives there is nothing to face. The work is already done and you are confirming what is there.

Do you need an accountant?

Many landlords with one property or a small portfolio will not. If your affairs are straightforward, with fairly predictable rent and a familiar set of expenses, keeping digital records and sending a year-to-date summary four times a year is within reach to do yourself.

An accountant earns their keep on the trickier stuff: complex ownership arrangements, large portfolios or unusual income. Some landlords will keep theirs for the reassurance, and there is nothing wrong with that. But MTD does not automatically mean hiring one. The day-to-day record-keeping is mostly noticing money coming in and going out, and writing it down somewhere sensible. If you can manage online banking, you can manage this.

A short checklist before your first deadline

1. Confirm your start date by checking your qualifying income against the thresholds above, so you know which tax year you are joining.
2. Choose how you will keep records. MTD requires digital records, so a shoebox of receipts will not do. You need software that keeps your records and files to HMRC.
3. Consider a separate bank account for your rental income and outgoings. It is not compulsory, but it saves a surprising amount of head-scratching later.
4. Get your income and expenses in order: rent received, mortgage interest, repairs, letting agent fees, insurance and the rest. Keeping these tidy as you go is far easier than hunting for them in August.
5. Put the four deadlines in your calendar now, with a reminder a week or two before each.
6. Do a practice run. Once your software is set up, enter a month or two of figures early so you have seen how it works before the real deadline.

Where Quarterwise fits in

This is the gap Quarterwise is built to fill: light bookkeeping software for UK landlords that keeps your digital records and files both the quarterly updates and the tax return to HMRC. You need somewhere tidy to record what comes in and goes out, and a tool that does the filing when the time comes.

MTD is a change of routine, not a leap into the unknown. Broken into small, regular steps, it is more manageable than the worry suggests.

This article is general information, not tax advice. Please check with HMRC or a qualified accountant about your own circumstances.