The firmware is the code installed for the processor on the controller board. The software communicates to the firmware via the USB lead that is connected between the computer and the controller box. Commands are sent from the computer to the controller board and the firmware code will process those commands and control the motors and monitor sensors on your machine.
If you have just purchased a machine then it will have the latest firmware already installed on it and you will not have to worry about updating it.
If we release a new version of firmware to fix some bugs that are found or to suit a new release of the software then we will release it on the downloads page http://www.ukcnc.net/index.php/downloads/
To update the firmware you will need to open up your controller box and use the JTAG programmer that would of been supplied with your machine. The instructions for uploading the firmware can be found on the download page also.