Making Tax Digital: Quarter One Is Done. Are You Still on Track?

If you’ve recently completed your first Making Tax Digital quarterly update, congratulations—you’ve reached an important milestone. However, quarter one is only the beginning. The success of the remaining submissions will largely depend on how well your bookkeeping, record keeping, and financial processes are working today.

Many businesses and landlords breathe a sigh of relief once the first submission has been made, only to find themselves scrambling again at the end of the next quarter. Rather than repeating the same stressful cycle, now is the ideal time to review what went well, identify any weaknesses, and make improvements while everything is still fresh.

Staying organised throughout the year will make future submissions quicker, more accurate, and far less stressful.

Why Quarter One Matters

The first quarterly submission often highlights issues that weren’t obvious beforehand. You may have discovered:

• Missing bank transactions
• Receipts that hadn’t been uploaded
• Incorrect expense categories
• Duplicate entries
• Bank accounts that weren’t fully reconciled
• Delays caused by waiting for information

These are all common problems, particularly during the first year of Making Tax Digital.

The good news is that quarter one provides valuable insight into how your bookkeeping process is performing. Any issues identified now can usually be resolved before they become much larger problems later in the tax year.

Making Tax Digital Record Keeping: What Should You Review Now?

Once your first submission has been completed, don’t simply wait until the next deadline. Instead, spend a little time reviewing your financial records.

Consider asking yourself:

• Are all business bank accounts connected correctly?
• Have all transactions been explained?
• Are your expense categories accurate?
• Have you uploaded copies of important receipts and invoices?
• Are personal transactions clearly separated from business expenses?
• Is your accounting software up to date?

Even spending 15 to 20 minutes each week keeping everything current can save several hours at the end of the quarter.

Common Mistakes After the First Submission

Many taxpayers assume they can ignore their bookkeeping until the next deadline arrives. Unfortunately, this usually creates unnecessary pressure.

Some of the most common mistakes include:

• Falling behind with bookkeeping
• Forgetting to upload receipts
• Leaving hundreds of bank transactions unexplained
• Mixing personal and business spending
• Ignoring software notifications
• Waiting until the final few days before the next submission

When records aren’t maintained regularly, correcting errors becomes increasingly difficult. Transactions are forgotten, supporting documents go missing, and mistakes become harder to identify.

Consistency is far easier than catching up several months’ worth of bookkeeping.

How Making Tax Digital Can Become Much Easier

One of the biggest misconceptions is that Making Tax Digital creates more work.

In reality, businesses that keep their records updated regularly often find that quarterly submissions become relatively straightforward.

A simple routine can make a huge difference:

• Update bookkeeping every week.
• Explain bank transactions promptly.
• Upload receipts as you receive them.
• Review outstanding items each month.
• Ask your accountant whenever you’re unsure.

Modern cloud accounting software makes this process significantly easier by automatically importing bank transactions and allowing documents to be stored digitally.

The less work left until the deadline, the less stressful each submission becomes.

Don’t Forget Your Tax Position

Quarterly updates are not simply about meeting compliance requirements.

They also give you an excellent opportunity to monitor how your business is performing throughout the year.

By reviewing your figures every quarter, you can:

• Estimate future tax liabilities
• Improve cash flow planning
• Spot rising costs
• Identify profitable areas of the business
• Plan for VAT or corporation tax where applicable
• Make informed business decisions earlier

Rather than viewing quarterly updates as another administrative task, they can become valuable financial management tools.

Getting Ready for Quarter Two

Now that quarter one is complete, preparation for the next submission should already be underway.

A few simple habits can make the next deadline considerably easier:

• Keep bookkeeping up to date every week.
• Reconcile your bank accounts regularly.
• Store invoices and receipts digitally.
• Review unusual transactions promptly.
• Resolve bookkeeping queries before they accumulate.
• Stay in regular contact with your accountant.

Small, regular updates are much easier than trying to organise several months of records in one sitting.

How Your Accountant Can Help

Although accounting software automates many tasks, professional advice remains extremely valuable.

An accountant can help you:

• Review bookkeeping accuracy
• Correct coding errors
• Identify allowable business expenses
• Ensure records comply with HMRC requirements
• Prepare for future quarterly submissions
• Estimate tax liabilities throughout the year

Working together throughout the year often reduces both stress and the likelihood of errors.

Final Thoughts

Completing your first Making Tax Digital quarterly submission is a positive achievement, but it shouldn’t be viewed as the finish line. It is simply the first step in an ongoing process.

The businesses that find Making Tax Digital easiest are those that maintain accurate records throughout the year rather than rushing just before each deadline.

If quarter one felt more stressful than expected, don’t worry. Most businesses experience a learning curve during the first submission. The important thing is to improve your systems now so that future updates become quicker, smoother, and far less time-consuming.

By staying organised, reviewing your records regularly, and seeking professional advice when needed, you’ll remain compliant and gain a much clearer picture of your business finances throughout the year.

If you’re unsure whether your bookkeeping is fully up to date or you’d like support with your next Making Tax Digital quarterly submission, our team is always happy to help you stay on track before the next deadline arrives.

Need clarity on your situation?
📞 Call 0161 710 1901
📧 Email Tax@TaxesDoneRight.co.uk
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