As we move past 5 July 2026, the first quarter under Making Tax Digital for Income Tax Self Assessment (MTD ITSA) has officially ended for those mandated into the regime from April 2026.

If you’re self-employed or a landlord now within MTD ITSA, this marks your first quarterly update and understandably, many UK taxpayers are asking:

• What exactly do I need to submit?
• How accurate does it need to be?
• What happens next?

In this blog, CJL Accountancy breaks it down in plain English.

What is the First MTD ITSA Quarterly Update?

Under MTD ITSA, instead of one annual Self Assessment return, you now need to:

• Keep digital records
• Submit quarterly updates to HMRC
• Finalise your position after the tax year

Your first quarterly update covers

• 6 April 2026 to 5 July 2026, or
• 1 April 2026 to 30 June 2026 if you've chosen to use calendar quarters for your self-employment

📅 Submission deadline: 7 August 2026

What Do You Need to Report?

The quarterly update is a summary of your income and expenses, not a full tax return.

You’ll need to submit totals for categories such as:

For sole traders:

• Turnover (income)
• Cost of goods
• Business expenses (e.g. travel, office costs, software)
• Other allowable costs

For landlords:

• Rental income
• Letting agent fees
• Repairs and maintenance
• Insurance
• Mortgage interest (restricted for tax relief but still recorded)

👉 Important:
This is not about perfection; it’s about reasonable, accurate totals based on your digital records.

Do You Need to Adjust for Accruals or Stock?

No, not at this stage. Quarterly updates are simple summaries. You do not need to:

• Adjust for year-end stock
• Include accruals or prepayments
• Make accounting adjustments

Those come later in your Final Declaration.

What Happens After You Submit?

After your quarterly update:

• HMRC will provide an estimated tax position (remember that this is only as accurate as the information you've sent and doesn't take into account expected profits for the rest of the year)
• You’ll continue to submit updates every quarter

After the tax year ends, you’ll:

• Make adjustments
• Claim reliefs
• Submit your Final Declaration

Think of quarterly updates as keeping HMRC informed during the year, rather than reporting everything after it ends.

Common Questions We’re Hearing

“What if I make a mistake”

Each quarter, you file the total to date, so any mistakes can be adjusted in the next update.

“Can I still use spreadsheets?”

Yes, if they are MTD-compatible. However, they must:

• Link digitally to HMRC via bridging software
• Not include manual copy-and-paste

Lot's of people are moving to cloud software like Xero, QuickBooks, or FreeAgent.

“What if I miss the deadline?”

Late submissions may result in penalties under HMRC’s points-based system, however, penalties are suspended for the 2026/27 tax year.

That said, it’s important to:

• File on time
• Keep records up to date throughout the quarter

How CJL Accountancy Can Help

At CJL Accountancy, we are supporting clients across the UK with MTD ITSA from day one.

We offer:

✅ MTD Set-Up

• Registering you for MTD ITSA
• Setting up digital record keeping (on Xero or spreadsheets - there are other options but these are what we're focussing on)
• Providing training on bookkeeping in your software

✅ Quarterly Filing Service

• Preparing and submitting your updates
• Ensuring compliance with HMRC rules
• Keeping everything accurate and on time

✅ Ongoing Support

• Advice on allowable expenses
• Bookkeeping
• Cash flow and tax planning

Our Advice for July 2026

Check your 2024/25 tax return:

If your gross income (turnover from self-employment + rental income before costs) is over £50k then you're in MTD ITSA from 2026/27.

If you’re affected, here’s what to do right now:

• Register for MTD ITSA if you haven't already
• Confirm your software is MTD-compliant and linked to HMRC
• Check your records are up to date for the first quarter
• Review your income and expenses categories
• Plan your submission before 7 August
• Get support if you’re unsure

Final Thoughts

The first MTD ITSA quarterly update may feel like a big shift but in reality, it’s about small, regular reporting instead of one large annual task.

With the right systems and support, it can actually make managing your finances simpler and more proactive.

Need Help With Your First MTD Submission?

If you’d like help with:

• Setting up MTD ITSA
• Filing your first quarterly update
• Ongoing bookkeeping and tax support

👉 Get in touch with CJL Accountancy today
We’ll make sure everything is correct, compliant, and stress-free.