HMRC Scraps Making Tax Digital for Corporation Tax – A Smart Move for Real-World Businesses
In a move that many in the tax and accounting world are cheering about, HMRC has officially confirmed (for now!) it will not be rolling out Making Tax Digital for Corporation Tax (MTD for CT). The Tax Institutions have welcomed the decision, calling it the right call – especially given the complexity of corporate tax.
For our clients, this announcement lifts a significant weight. The proposed MTD for CT regime would have required all companies, big and small, to maintain digital records and submit quarterly updates to HMRC. While this might sound like a push toward efficiency, the reality was far more nuanced.
For small owner-managed businesses, this avoids what could have been yet another compliance hurdle without clear returns.
The good news is that many businesses have already embraced digital tools voluntarily. HMRC’s own figures from a 2020 consultation showed that around 40% of small businesses were already keeping digital records back then and that number has only risen. For those already ahead of the curve, mandatory quarterly CT reporting offered little value but plenty of extra admin.
What does this mean for you?
- Less Disruption – We won’t have to rush clients onto new systems or deal with training and troubleshooting just to meet quarterly MTD – CT filings
- More Flexibility – we can continue to tailor digital adoption plans for our clients’ individual needs, rather than ticking off a compliance checklist
- Better Conversations – with HMRC engaging in meaningful consultation, we have a real opportunity to influence future changes in a way that supports client success, not just compliance
So while the broader MTD journey continues, the announcement offers a rare pause button. In a world where tax rules often feel like they only move in one direction – toward more reporting, more complexity and more pressure – this makes for a refreshing change.
And if HMRC do change their mind, well at least we can enjoy the peace for the time being!.
