Earlier this month HMRC published their consultation and plans for Making Tax Digital for corporation tax (MTD for CT).
HMRC have proposed the main elements of the scheme to be:-
- All entities within the charge of corporation tax will need to maintain their records digitally;
- Those entities should use MTD compliant software to file quarterly summary updates of their income and expenditure and
- Entities should be able to submit the annual corporation tax return (known as a CT600) via their MTD compliant software.
The pilot scheme for the MTD for CT will open in April 2024 and at the earliest it will be mandatory for all companies which do not meet an exemption criteria to join the scheme in 2026.
Many companies will already be prepared because of the digital record keeping requirements from Making Tax Digital for VAT. Companies not VAT registered will need to prepare for this change.
The requirement to join MTD for CT may be several years away but companies may wish to prepare early and take advantage of the benefits of cloud accounting software which are MTD compliant.
Some of the many benefits to transferring your records to cloud accounting software can include:
- Time saved on administration and bookkeeping
- Access to management information throughout the year using reports
Please contact your local office for further information if you require further advice on this matter.